My April 2019 book, The Fairshare Model: A Performance-Based Capital Structure for Initial Public Offerings is available in paperback from Amazon and bookstores and as an ebook from many platforms.
I call it The Fairshare Model because it aligns the interests of investors and employees. It has implications for how to attract funding to companies that have poor access to equity funding but who have the ability to attract an affinity group of public investors. More significantly, it has potential to help companies attract and manage human capital.
The Fairshare Model was conceived to deal with the uncertainty involved in establishing a value for a venture-stage company. There are ways to mitigate the risk of getting it wrong in a private offering, deal terms. But there is no equivalent in an IPO. The Fairshare Model changes that with a deal structure that places no value on future performance. It does that by providing shares for future performance that vote but cannot trade; they convert into the tradable stock based on performance milestones.
Here are some reactions from reviewers of the book:
- Ken Wilcox, Chairman Emeritus of Silicon Valley Bank, describes it as “An important work”
- Gordon Feller, is a board member at four VC-funded tech startups. He says “Pay-for-performance might sound like it’s just too far out…this book shows how it can be relevant”
- Po-Chi Wu, senior partner at FutureLab Consulting, asks “Why not reimagine the relationship between investors and company employees to be one that is fairer and benefits both?”
- The assessment of Gregory Wendt of Stakeholders Capital is “I highly recommend [The Fairshare Model] for entrepreneurs, practitioners, academics and investors who are committed to the common good for all.”
Karl M Sjogren