Before we set up your ESOP, let's do a quick terminology review.
All participants in Equity Pools have various Equity Plans, from which Grants are given to specific Participants. Participants can be employees, Board Members, co-Founders, etc. Examples of Equity Plans include ESOPs (Employee Stock Ownership Plans).
Think of it this way...
Your company is an apple tree 🌳
An Equity Pool is a branch of the apple tree 🌱
Equity Plans are the apples on that branch 🍎
Grants are slices of each individual apple on that branch 🍴
What's important to remember is that it all starts with the Equity Pool, or the branch of the apple tree. Founders need to decide which branch to offer, and how big or small the branch is (how many apples are on it).
Once the size of the Pool is decided, Founders then decide on the different Plans they want to include (apples). Each Plan then needs to support its Participants, who receive various Grants of the Plan (slices of the apple).
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