Whether Giving Away Ownership in Your Agency is the Right Call

O*NO! Your staff have been working super hard and you want to reward them. As a Principal, you might be motivated by building your agency as an asset or extra income via dividends each month.

You have decided to reward your staff with a bonus payment or equity in your agency, but have you stopped to ask what actually motivates your staff?

Before giving away equity, ask yourself is it really necessary if you can reward them in other ways?

What motivates my staff?

What motivates you may not motivate your staff. Whilst it might often be hard for Principals (or law firm owners like me) to understand, not everyone is motivated by ownership or extra cash. So, before you decide to pay that bonus or offer ownership to your gun employees, really get to know them and find out what they see as a reward for great performance.

What motivates us changes over time

If my boss had asked me to choose my own performance-based bonus a few years ago, I would not have asked for money. What I love to do is travel, and for me, having extra paid leave would have been icing on the cake. Now what motivates me is growing my own firm from the ground up so I can build something for my future.

So whilst you may have known what made your gun employee tick 3 years ago, you will need to find out what motivates them now.

Will I lose staff if I don’t offer them ownership?

Maybe, but I don’t know you and your staff well enough to answer that question. You are best placed out of anyone to know what you should do next in your agency. I will say this – you won’t know if you don’t have open and honest conversations with your staff.

Takeaway

Perhaps you are looking for someone to take over your agency so you can retire, or you are expanding and want to ensure someone with ‘skin in the game’ is in charge of your office. That is a very different question to simply putting golden handcuffs on an employee, and could be a genuine reason to bring in an employee as a shareholder to your agency.

Your next steps

Thinking about bringing a key employee in as a shareholder in the next 12 months? Book a FREE 10 min call with us today to discuss your options.

Boring legal stuff: This article is general information only and cannot be regarded as legal, financial or accounting advice as it does not take into account your personal circumstances. For tailored advice, please contact us.