Dana Shultz explains why giving stock as compensation can be an attractive method for early-stage companies lacking cash but warns that giving stock as compensation without putting restrictions on it can take away from the utility of the strategy. He advises business owners to remember that stock is very valuable and that owners need to take steps to ensure the recipients earn that compensation and don't just take the money and run. Owners must ensure that their business personnel remain at the company after receiving stock in order to keep both parties' motivations in line.
- Summary by FizzLaw Team
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Stock is Great – but Don’t Give It Away Too Quickly!