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The talent environment

 To hire and retain the best talent share incentive schemes are increasingly expected in the software industry and with good reason.

Software companies can end up being extremely valuable and having a small slice of the equity can be life changing for the employee.

Why software companies need employee ownership

Software companies are typified by an upfront cost associated with designing and building a system.

The choices made by the employees in this design and build stage are crucial to the long term success. And the most successful software companies think ahead to minimise technical debt and ensure flexibility, maintainability and scalability.

And perhaps the best way to encourage software developers (and all the staff such as sales people) to think for the long term is to make equity based compensation a significant part of their remuneration package.

Key considerations

Key factors to take into account when considering schemes for software companies include:

  • the number of employees
  • the size of the business
  • the maturity of the business
  • the presence of IP and whether this is owned or leased
  • whether it is being bootstrapped or backed by venture capital
  • whether it is a mature quoted or private equity backed company

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How Pett Franklin can help