ESOP PLAN

ESOP Template and Step by Step Guide to Retain and Attract Top Staff

You need an ESOP template, or employee stock ownership plan. There just has never been one available. So I built it. It’s taken me a year to ship it as it was really hard to make something simple!

Let me break this down for you. How do your staff get rich? Owning a stake in your startup, right? How do staff participate in the upside of your startup… they own options through a structure called an ESOP (Employee Share Option Plan).

Only what the hell does an ESOP plan look like and how do you structure up something really special? Well, thinking is really overrated, in my humble opinion. I’ve made an easy to follow Excel model that is super, duper powerful and does all the heavy lifting for you.

Yes… you do need to know things like what you pay staff, the date you are going to grant them shares (duh). You need to add in when you fundraise (to get diluted shares). You need to follow step by step instructions… but if you can handle all that, you have something pretty darn tootin nifty!

There is not another employee share ownership model on the internet (Lie, there is something unuseful), so if you want an ESOP template this is the ONLY one.

Download now

The ESOP Plan model is available through SSL secured purchase via a Stripe. The model will be immediately emailed to you.

€129

The step by step ESOP template guide

To make it easy to use this model, I mapped out how to use the ESOP example step by step in this SlideShare presentation. You’ll have your kick ass ESOP plan up and running in no time!


This model can be converted into 17 different currencies

This model uses formatted currencies in $. I often get asked if it is available in other currencies such as €? So I made an Excel PC addin to do that (It was hard!)

At the press of a button you can now convert the model into 17 different currencies. You just need to purchase the productivity addin.

Here are the currencies you can use with the macro:

Currency list What it looks like
EUR
USD $
GBP £
YEN ¥
INR
Krone kr
BAHT ฿
RUB
Peso
BRL R$
RM RM
Rp Rp
HKD HK$
ILS
KPW
RMB ¥
CHF CHF

Productivity addin

Image

More than likely, you aren’t a huge Excel nerd like me, so you probably don’t know about macros? These are hacks to make modeling in Excel much more faster and less painful. I love them!

I’ve been making models for years, so you can be sure I know what is useful and what is not. I decided to not just make the currency conversion macro, but add in all my most used hacks. You just hit a button and it will do handy things.

What can you do?

  • Automatically format your cells so they have ‘investment banking’ standard black, blue and green
  • Change the zoom and cell position of every sheet so it looks great when others read it
  • Save a backup of your model (v1, v2, v3) at the push of a button so you never get a corrupt model
  • Add error checks to your formulas
  • And a whole bunch of other nerdy things you’ll understand when you are making models yourself!

NOTE:

  • This is for PC. Gates hates Mac so…. All the plugins other than ‘check sheet sizes’ work in Mac, but I don’t warrant anything if you are on Mac (Sorry). I’m trying to find a developer to rewrite the code for Mac so the images, tips etc work too
  • Currency conversion only works on 50Folds models. It won’t on any other model (My code looks for certain cells… There is a hack- ask if you want to know)

If you want it, you can get the productivity Excel addin here.

Video on the ESOP template

I’ll try get something done soon!

My approach to ESOP template

If you want the Ttl;dr and understand the importance of an ESOP plan and how my model approaches it, here are some slides from the guide above.

The ESOP Plan Excel Model

So what does this bad boy look like, then?

ESOP template ESOP template ESOP template ESOP template ESOP template

Get the ESOP course

We just went through the ESOP template. If you don’t understand all this jazz about shares, I made the only course on the internet to take you from the very basics up to legal nerdom. You can get it here. I highly, highly recommend doing this. Yes, there is 3 hours of video content, but you will be a total boss by the end of it. Or you can just live in ignorance, which is a scary place to be.

eduardo esop feedback

ESOP template

ESOP template

Conclusion

There we go. I really hope this will help you to create a professional incentive structure to delight your staff! Any questions, please sound off in the comments, and I would be delighted to help!

Download now

The ESOP Plan model is available through SSL secured purchase via a Stripe. The model will be immediately emailed to you.

€129

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Comments 4

    1. Post
      Author

      Justin – Since we are talking legal ownership, you would want to account for this in a cap table. I have one that I’ll try get done. This is for having a solid overview and for planning purposes, but I wouldn’t use it as a legal document.

  1. HI Justin, very nice and comprehensive model! Saved me weeks thank a lot!
    Have a question: We closed a Series A Prefered at a valuation of $47M, share price $56. A couple month later we did a 409a and it come in at a equity value of common of $15M and a shareprice of common of $11. Which should I use? Should I exclude the preferred shares from the shares amount? What shoudl I input in Assumptions D114

    1. Post
      Author

      Hi Matias –
      Justin asked a question too…

      Thanks for the feedback 😉

      You did a raise and the valuation of the PREFERENCE shares was set at a price of $56.

      If you did a 409A valuation for the COMMON with the goal of setting a strike price for options, which requires the FMV of a price per share of common stock, then the price for the common shares is $11.

      Institutional fundraising are done through a different class of stock (PREFERENCE) with better rights.

      Your 409A valuation firm basically said there is a difference between the two types of classes of share to justify a lower valuation for the common (and hence the strike price of the options) than what the investors paid for the preferred.

      The one you care about for the strike price for your staff is therefore $11.

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