Duo helping ambitious SMEs to power growth with share option schemes

Two former senior figures at Manchester-based AI software business Peak AI have hit the ground running with a new venture helping to fuel growth for SMEs through share option schemes.

As Peak’s finance director and head of legal respectively, John Fraser and Saddleworth-based Rachel Westwell managed the company’s sale to US-listed AI software giant UiPath earlier this year.

Before that, they designed and ran Peak’s share option schemes through $120m of investment rounds, including from SoftBank.

Now they have set up equiCraft to design, implement, maintain and optimise company share option schemes, helping businesses to attract, retain and incentivise top talent.

They say share options are increasingly being seen as a valuable compensation and reward tool among ambitious start-ups and scale-ups, especially in the technology sector.

The duo are working across the UK with C-suite executives and ambitious business founders, as well as private equity and venture capital firms seeking to incentivise teams in their portfolio companies.

Rachel said: “The UK start-up scene is booming, and competition for talent is intensifying, leading to equity schemes becoming critical for attracting and retaining the best people.

“They enable new businesses, which are usually protective of cash and unable to pay top salaries, to attract the world-class talent they need by offering an alternative form of compensation.

“They can also be used to incentivise and retain, with additional option awards being an efficient way to reward employees at key milestones in place of bonuses.

“Bonuses put pressure on the company’s cashflow, and share options are often more attractive to employees as they can grow in value over time.

“Moreover, they are much more tax-efficient when granted under an HMRC-approved Enterprise Management Incentives scheme.”

Rachel added: “Generally, share options are awarded according to a vesting schedule, with employees being entitled to a part of their grant annually over a number of years.

“This provides a greater incentive to stay with the company on its growth journey for longer – if they leave early, they won’t receive the full value of their award.

“In a successful start-up, that could make a big difference to the amount the employee will receive, from several thousands pounds to tens of thousands.

“Furthermore, equity schemes aren’t just about hiring and retaining talent.

"Equity can play a significant part in building an engaged team who adopt an ownership mindset.

“With everyone aligned towards the same goal of success, ultimately all shareholders benefit as the value of everyone’s equity grows.”

John said: “We’re using our experience when it comes to successfully managing equity planning, to help people avoid costly mistakes.

“We do this by designing schemes tailored to the team, the growth plans and vision, implementing them and then managing the day-to-day operation of them so they stay on track to suit the business as it evolves, and finally by optimising them, ensuring they are reviewed and refined to keep them effective.

“There’s a clear pattern to the problems faced by companies when managing equity.

“External advice tends to be fragmented and not enriched by industry experience.

“Templated equity solutions flood the market but often lead to long-term complications and unintended consequences.

“Start-ups often have a lack of knowledge and experience of implementing and managing share option schemes, which can lead to compliance risks.

“We’ve been in their shoes and we know the journey, the pitfalls and, vitally, the solutions, and we want to use our experience to help founders and executive teams to design and run share option schemes that actually work for their teams and for the long run.

“The initial reception has been hugely positive as we fill a clear gap in the market by offering a powerful blend of finance, legal and HR equity support delivered by specialists with start-up experience.”

---

Do you have a story for us? Want to tell us about something going on in and around Oldham? Let us know by emailing news@oldham-chronicle.co.uk , calling our Oldham-based newsroom on 0161 633 2121 , tweeting us @oldhamchronicle or messaging us through our Facebook page. All contact will be treated in confidence.