Life at Easy Agile

5 min read

Ownership at Easy Agile

Fri Apr 22 2022
Dave Elkan
Written by Dave Elkan, Co-Founder and Software Engineer

💬 “We know we’ve created something special, an ESOP like no other…”

Nick and I started Easy Agile after returning home to Australia from living and working in San Francisco where we witnessed the good and not-so-good sides of startups.

We were lucky to experience first-hand the amazing career opportunities and growth that working for successful companies such as Atlassian and Twitter can provide. On the other hand, we also saw companies start-up, consume vast amounts of funding and flame out. There was a terrible toll taken on our founder friends and their families who put life balance aside in pursuit of success at any cost.

We took all of this into consideration when we started Easy Agile. We didn't want to default to the standard VC-backed journey so we set our own pace. We wanted to learn what it was to build a customer-funded, sustainable growth product business, even if that meant a more difficult learning curve as we carved our own path.

Well, that was 6 years ago and here we are happily customer-funded for over 5 of those years, growing at an exciting rate, we believe is healthy and sustainable. We're proud that we're bootstrapped and we're not really looking to change that.

💬 “We can do things differently”

One part of the common startup playbook which we did want to retain is employee ownership. We have been dying to introduce an ESOP for a long time, however, being bootstrapped and customer-funded makes creating an Employee Share Option Plan a bit more complicated. Off-the-shelf plans are usually based around the concept of a planned (or hoped for) exit event, as it’s the only time cash-burning companies can realise value for shareholders. This would not work for us and we were looking to provide a more accessible way for our team to realise the value gains as we grow.

We also knew in our hearts that our ESOP had to be a reflection of Easy Agile's values. We understand the wonderful people that make up Easy Agile are all at different stages of their careers and have different needs financially so we designed our ESOP to take this into consideration.

Our ESOP also had to be generous. Nick and I really want to continue to pay forward the generosity we’ve been privileged to experience and enable our entire Easy Agile team to have the opportunity to achieve financial freedom. We hope one day many of our Easy Agile team will find themselves as founders of successful companies and continue this tradition with their own ESOPs. 🤞

Now our ESOP is live, we know we’ve created something special, an ESOP like no other. There’s no standard template for what we’ve built as very few startups or scale-ups in Australia are in our position. We’re growing fast, we’re profitable and we aren’t constrained by investor demands.

It means we can do things differently.

How the Easy Agile ESOP is different

1. Generous valuation from the start

For our initial grant of options, we valued Easy Agile using a super-low valuation. This gives our initial option grant the highest immediate appreciation of value on paper we can give.

This type of valuation based on our "Net Tangible Assets" (NTA) is made possible by the Australian Start-up Tax Concessions. Being a software company, our assets are limited to the cash in our bank and some laptops. We have no debt.

At the same time, we also have a “Fair Market Value “(FMV) calculated similarly to other SaaS companies. It worked out that our NTA valuation for our initial grant was 44 times lower than our FMV valuation meaning by accepting your options, on paper, your options are already worth 44 times more than you will ever pay to exercise them.

We feel this is pretty special.

2. Real $ value for our team more often through an Option Buy-Back

We understand that our team members all have different needs financially. Some have mortgages. Others want to buy a house. Others are happy to rent and invest in other things.

We’ve ensured our team has the opportunity to realise an exit at a time more suitable to their personal needs.

Our Option buy-back scheme allows Easy Agile, to offer to buy back vested options from our team at the Fair Market Value. Our team can choose to take advantage of the company’s growth and turn some of their Options into cash far more readily than waiting for an exit event (IPO, secondary, sale, etc). This is a profoundly different concept from most SaaS companies. They can also choose to hold onto their Options for the long-term gains we all work together to achieve.

3. Dividends

Most SaaS product companies don't really get to a dividend issuing phase. They simply don’t have the profits available. Once again, we're different here. We have a sustainable growth trajectory enabling Nick and I to issue dividends to shareholders over the course of the life of Easy Agile. We will continue to do this in the future and so Easy Agile shareholders will benefit long-term with dividends and voting rights that come with Ordinary shares.

4. You can nominate a trust

We allow you to nominate a trust to hold your share-holding. Nick and I are fans of getting serious about financial planning and literacy (just ask our team!). We wanted to give our team the most flexibility we could, so we allow for our team members to nominate a trust to receive their options instead of themselves personally.

What’s next?

We’re thrilled to be at this stage in our journey as it enables Nick and I to better reward the team who have built Easy Agile with us.

We’re even more excited about the journey ahead. We have big plans, the ability to invest in our team, our products, our growth and most importantly the impact we are having for our customers.

We’re always hiring so please reach out if you want to be part of the team that’s leading the way in helping companies around the world be agile.

💬 “We hope one day many of our Easy Agile team will find themselves as founders of successful companies and continue this tradition with their own ESOPs”

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