EPISODE
20

The 2024 State of Aussie Startup Employee Equity with Kim Hansen

Hosted by Jason Atkins
President & Co-founder, Cake Equity
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In this episode of Startup Equity Matters, Cake Equity co-founders Jason Atkins and Kim Hansen discuss the importance of understanding and maximizing equity in startups. They delve deep into the release of Cake's Report: The State of Aussie Startup Employee Equity 2024, which provides valuable insights for founders and leaders on how to attract and retain great teams through equity.

Tune in to learn more about the significance of equity in startups and how it can be optimized for success.

Check out Cake Equity's report here: https://www.cakeequity.com/blog/au-startup-employee-equity-2024

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Jason Atkins: Hello, welcome to today's Startup Equity Matters--the podcast about making equity simpler and helping us get real value from startup equity. We don't want to work on these great companies and be stuck with lawyers, accountants, and jargon, and end up with no equity in the companies that we're building. So, I'm excited today to be able to bring you, finally, my co-founder at Cake, Kim Hansen. Hey, Kim. Obviously, Kim and I have been on a great journey together. I think we've been working together for about eight years. We're scrapping around the Gold Coast ecosystem early on and we thankfully worked out how well we would be able to work together, and it's been an awesome journey. Kim's very passionate about innovation and entrepreneurship, and obviously, particularly equity and how we can make it better. Specifically, today, we're going to talk about a report that Cake has just released. It is an Australian equity report, so sorry for those global listeners, but hopefully, the concepts that we talk about will resonate with you because we need to make sure that as founders and leaders of startups, our teams actually know what they own and what it's worth, and that you can attract, engage, and retain great teams with your equity; and our report has some fantastic insights on that. But first of all, let's dig into the man, Kim. He is a great startup guy. He's been doing this stuff for a long time, and he's super passionate, as I said. So, Kim, welcome. Obviously, I could lead this conversation down a whole bunch of embarrassing rabbit holes for you. No, I'm kidding. Let's start with the equity side of things before we go back too far. What is it about startup equity that excites you and has you spending all your time on it for the last five years, at least?

Kim Hansen: It's a lot of pain, but first and foremost, thanks for having me here for sure. It's awesome to jam on equity with you. And it's good to just take a step back and celebrate how far we've come from not knowing anything, but being super passionate about the startup ecosystem. And now, we're putting out a report of what's actually happening in the whole Australian ecosystem. And we're going to do a lot more of that globally, as we start gathering the data. I've been driving my own passion to deal with this difficult thing. It's just a lot of pain, confusion, and exclusivity. I remember one of my first jobs, I worked for the big banks in Portugal, and one day, the CEO came in and said, “Hey, Kim, there's something super, super exciting. We're going to give ownership now to the partners.” I was like, “Wow, that sounds super important.” That sounds super exciting, but I'm not part of it, so I also felt super excluded. It just left me with a really bad taste. I also had no clue what it was, but it sounded really important and cool, but I was not part of it.

Jason Atkins: Okay, great. Way less cool.


Kim Hansen: Way less cool. So for my second story, I went, then I left that company after some time. Surprise.


Jason Atkins:
Oh, you left the bank? Why would you do that?

Kim Hansen: I did some more cool stuff with some cool companies. Then when I got the chance and there was like, “Hey, I want to be a partner and I want to have some equity.” I had no clue what it was, but it sounded like it was important and something that I should be part of. Then I got these long contracts that I had to read and try to understand. I had no clue what it meant. I tried and talked with lawyers, but I didn't know how to ask the right questions or anything. Yeah, at least I got some ownership. And then after a couple of years, we started actually building a really good business, we started incubating startups, and it was all super exciting. We could start saying, “Hey, there's value in this.” Okay, what about all the others? The first people I hired that actually built this that are grinding it out every single day? Why are they not invited to this kind of ownership? I still don't know what it means, but it's awesome. It has some sort of value. And then I was trying for a couple of years–for two years to convince the CFO and the CEO. I was a partner in CTO, but it was in the hands of those guys to try and figure this out. and it was just too difficult, too painful–just impossible. And I was just like, this sucks beyond. So a lot of the foundation of the pain was already put in for me. And then, the team is sitting here every single day, grinding it out and building awesome stuff. These are the real heroes. We need to focus on these guys and just improve this stuff. So a lot of confusion. Exclusivity was kind of my introduction to equity and hopefully, it's come far, but there's a lot more work to be done on that part.

Jason Atkins: Yeah, we have come far. That was a UK-based company in England, wasn't it? And you're operating in Portugal. So it was international equity. I'm pretty sure you had some people in the US at the time. For any of you out there that have handled international equity for teams, it's just like, super hard. Although, quick shout out to Cake, we've made a ton of progress in this area. Do check it out. Although this is not an advocate, we have been working on this for some time, so it's worthwhile having a look. Yeah, when we first met, and the reason was–just to jam on that a little bit. I came from a finance background, then I came into the technology industry, and I was helping companies to raise capital. Every single time I saw a contract, it was a different contract. And when you go to the lawyers, they just bamboozle you with all the jargon. And even with 15 or 20 years of finance experience, I found it really challenging to understand these contracts in any real meaningful way. And year after year after year, I still learn. Oh, that clause actually means that. Oh, great. Now, I finally realize. But I signed the contract like three, four years ago, so whoops! Now we need to help.

Kim Hansen: It's easy to screw up along the way and you figure out down the line.


Jason Atkins: It would have been good to have known that thing at the time as you're trying to invent with this equity and you're throwing it in all directions and be like “Hey, that's probably not a good idea later” So, a lot of founders would just be like “Oh, equity is too hard” Thankfully now, through companies like Cake and leaders like us, and there's lots of us around the world. We're by no means taking responsibility for everything–all the credit, but there's been a real movement over the last 10 years in this space, and we're so grateful to be part of that movement and help just improve education and accessibility. We hope that every unicorn from now on, although unicorn is probably a dumb aspiration, especially post-2021 Zurp craziness, but every great company will have employee equity and will have people participating. Whether it be small, medium or large financial outcomes, people are getting involved in that. As you and I talk about a lot, and we'll get into this actually probably is a great thing for you to jam on a little bit is like it's not all about the outcome. It's not all about the financial outcome that has to be part of it. And of course, it's part of it with equity. It's a financial product. But it's the meaning that you get from being part of the team and having skin in the game and those day-to-day, month-to-month relationships that you build is really where the magic is at. That's the second type of real value that we see.

Kim Hansen: Absolutely. And it's so difficult for a startup that they have to attract the best people because it's such a difficult thing to disrupt, to innovate, and to take down an incumbent that is already in thespace or do something that doesn't exist. Right. So you need really, really dedicated and smart people. And often, those people, they can make a lot of money to work for a big corporation or a big bank or something like that, so you got to have something extra to motivate them. And of course, you have your vision and you have a culture and it's something that is meaningful, but certainly, that upside financially because you will typically pay them lower salaries when they can make more somewhere else. But giving that ownership really creates a lot more meaning and dedication and we can get to those financial outcomes. And it's ultimately also the power in the people's hand to create their own success and the financial outcomes. That's a really big thing. I also think there's an indirect motivational driver just by the feeling of having ownership and being respected like that along the way, which then indirectly actually generates more results and gives a higher salary along the way. So I think it's really about driving that motivation and meaning. Of course, we need to get more liquidity along the way and facilitate that, so it's not just an exit or an IPO.

Jason Atkins: Absolutely. Before we get into that–because that's great stuff… For the listeners, we're going to cover what it is, why, and how to get the most out of it. And we're definitely going to dig into the data. We did a great survey. We surveyed our customers and the whole community to try and work out what's working and what's not, and how as leaders, we can help improve equity as a real driver of value for your startup. But let's keep back because you've done some cool stuff. Tell everyone about The Impossible Journey. It was a really cool company when we first met. I couldn't believe that someone would not toot your horn too much. But with your background down here in Australia, on the Gold Coast, you were doing some amazing stuff there, right? You built an incredible company working with some of the best tech companies in the world out of Lisbon. So tell everyone a bit about that. That's a cool story.


Kim Hansen: Yeah, absolutely. Thanks for that. I've worked a lot with the banks there and I was forced to sit on a chair. But that didn't feel like being the most effective way to work. I'd done some remote work and could see I could make money when I was traveling and stuff like that. But still, it was cooler to be with other people. So I was lucky to come in to Inform Impossible with a few other guys. They had some really good networks, so we could work with Google, Samsung, and Roche. We're building really cool stuff and taking all that technology experience that I had from building the banks, where technology needs to be right because you can't get those transactions wrong. Then putting it into a really good user experience and product. But I still felt we were quite detached from the actual customer, so we're doing a lot of smoke and mirrors and bloatware.


Jason Atkins: You taught me a lot about how effective consultants are over the first few years of working together.

Kim Hansen: It was awesome for that learning journey and just learning the value of UX, but still, I wanted to get a lot closer to the customers. We built more and more freedom in Impossible as well, so I could see that actually, it's a bit of a positive advantage. If you're really happy and healthy, you're going to produce better results and all of that. Remove the time constraints that you have to sit in a chair for eight hours to be really effective. So the creative, healthy lifestyle–this concept I have around kind of company culture and work performance was starting to be kind of thought about at those times, and that was super exciting. Yeah, I can talk for hours about that.


Jason Atkins:
I think we should actually touch on that a bit. You know, creative, healthy lifestyle is part of the Cake culture and ethos. We talk about it at the end of every Startup Equity Matters episode. So for those of you regular listeners, this is kind of where it came from, and it's been critical for Cake's success, our brand, and having a happy, healthy, and committed team. I'm a total advocate, obviously. I had inclinations down this path anyway, when we met, and that's part of why we get along so well. Tell us a bit about the origins of CHL, as we now call it. Tell us a bit about how those threads run through into Cake now as well. I think it's interesting.

Kim Hansen: Yeah, absolutely. It's ultimately derived from the belief in the potential of human beings. I think we can do so much more than sitting in front of Netflix and eating pizzas. Builders to be creative people. Once you become a dad and you see a little child of two years old that is just running off–it's just full of energy and everything is just a learning experience, right? It's full-on curiosity and creativity, and I always kind of, for me, it's the core. Why? That's who we are as human beings. We put all these layers, but there's so much energy and creativity found right there. Now, how can we have that in a work context? When I worked at the consultancy agency, we're working for all these corporations, so we're like, “Okay, let's travel out in nature because we were in the big city and work from there and be very effective on that.” But ultimately, I got tired of always driving out in nature and I thought, “Well, the Gold Coast is a pretty awesome place to do the opposite.” Let's be in nature and then travel into the cities when you can and have much more of this creative, healthy lifestyle. Basically, it's incorporating a life that includes more focus on health, more focus on nature, making sure you have really good family relationships as they're the foundation for you to function well as a person. And also, as human beings, if we suffer inside, it's really difficult to make creative good stuff and think about being empathetic and really care for nature and all of that. So if we are close to nature, if we are close to and have good family relationships, all our products decisions will take that into account. So I believe we create a better world with that. So we do a lot of that at Cake. We celebrate everyone's journey, and this is not about going to a fitness center every day or anything like that. Each person is on their own journey. We call it kind of, we like the Japanese concepts around ikigai. What is the individual's ikigai and journey? It can be reading a book, going for a walk, going out surfing, whatever it is. But we help and support each other on that journey. And it is important that health is something that is a priority for everyone.

Jason Atkins: Yeah, I absolutely love it. And for those of you that know Cake and the Cake community, I'm sure you've experienced this vibe permeating through us almost constantly, but more overtly through our yoga and surf events and whatnot. It's just a fantastic way to be. And more and more people are on the bandwagon in their own way. And that's cool. I guess one last thing on the old school stories, just to get to know you a bit. You've incubated a bunch of startups out of Impossible, in the beginning of your startup journey. I know Bond Touch is a cool one. I hope you don't mind me naming that. Just tell us a little bit about how you got into the startup space in the early days. It's interesting to hear how people get on that journey.

Kim Hansen: No, absolutely. I think it was the constant learning about what technology can do, whether it accelerates things. Okay, great. If you're building products and using product thinking, great, you can create better experiences. You can take that technology that's often hidden and then create a lot of value for that. But throughout the consultancy work, we were not close enough to the customer, so I was really seeing that. Well, there was Silicon Valley. We were lucky to work a lot from there. I saw the design thinking and how you create empathy. It's all about before you throw a lot of technology at stuff, you're really trying to validate, “Is there a problem here?” “What's the context of the person?” Really shifting that perspective and then constantly validating that. And then you slowly introduce technology to accelerate it. So I think that created the foundation for startups. And then at Impossible, as we were doing quite good with the consultants, where we started having all these skills to think about the user experience, we thought it would be awesome to try and change the world for the better and start incubating startups. And we did multiple internal products and projects and a lot of them failed and crashed, and some were kind of linear growth, so it never really happened. And then we had One Touch that actually went kind of explosive. The timing was right. It was a great product. We iterated fast. It was really tricky because it was hardware and software. We had learned some hardware from experience with a great company called Fairphone, which was its own startup, but we were very close to their journey and seeing how they built hardware, so we could take a lot of those learnings. Later on, when we had this big success with Bond Touch, a lot of greed came in. The contracts around the equity kind of became really, really, really important, and the partners kind of started having a big battle, and it took many, many years to resolve that. I saw how what happens if you don't get the contracts right, it can just ruin families and lives, and it costs so much money. I also felt the pain, and typically, what lawyers will do is that they will fortify you. They'll put walls around you and they're going to put up guns, and then it'll take your money forever. There's no solution there. It's just an ongoing thing until someone gives up out of pain or run out of money.

Jason Atkins: Yeah, it's pretty gnarly watching good quality lawyers with deep pockets on all sides. It's crazy what goes on.

Kim Hansen: So I think we have an opportunity to make sure less startups end up in this situation, so that it's more clear what the different ways are. Ultimately, when there's no clarity in things or you're not following the best practices or standards, you end up in these gridlock situations that just ruin everybody except the pockets of lawyers.

Jason Atkins: Incredible learning there. And of course, bad outcomes can always happen. We are humans. We have weaknesses. Everybody goes on their own journey. And when lots of money is involved, people can get really confused and weird. And then lawyers are like actual experts at making it worse. Sorry, lawyers, we love you in some ways, but you can be tough at times. But you can mitigate the risk, and the key lesson here is: It's at day one, unfortunately, when you have to mitigate these risks, and it's hard, but you can't go back and unravel a lot of these things when it comes to legal contracts, compliance, regulatory rules, and tax. So not to scare you, and we want it to be simple and fast, but you do need to try and get these things as right as possible in the beginning. That's a good pivot into cake because our whole mission for the last five, six years has been in this area. How do we help simplify and streamline equity so founders can move fast and not end up with big problems down the track? Because we don't want to see day-one founders kill themselves to get 500 grand of the bank from angels and then spend 20 grand on legals. We don't want to see them make huge mistakes. We want to see them build great teams and use equity for their teams. But then again, we don't want to bog down for six months going backwards and forwards between their accountant and their lawyer just to get something simple set up. So let's go into Cake. Let's talk about some of the innovations. Let's talk about the journey. Let's talk about some of the wins that we've had. Maybe we can start with like the one click ESOP. I think one of the coolest things we've done, we call it ESOP, or it can be called other things, but it means employee share option plan. We have one at Cake where you can hit one button and largely, the whole thing appears. It's pretty amazing. I'm gonna talk a little bit about the journey in building that and some of the war wounds we have.

Kim Hansen: Absolutely. I guess sometimes, it's good to be naive around a technical subject that you're trying to solve, because otherwise, you would give up if you do too much about it. And I think that's definitely been, from my perspective, a little bit in the beginning and ongoing. But also, we create the world we want to see. Right. So further down the line, our vision is to really make equity invisible, so you only get the ultimate power of it as a motivation driver on the team and then create liquidity. But that's a stepwise journey to get there. We understand that the contracts need to be there, but we also saw, for example, when you go and book an Airbnb, there's a contract signed, but you never touch that contract. You never have to read it, so it's kind invisible in the background. So these kinds of solutions were inspiring us. We saw on Amazon, in the beginning, when you had to buy online, you had to fill out all these forms and it was just so complex and so, so painful, right? Then they invented a kind of a one-click checkout button and functionality. So here, we can see how you can just really make a lot of these things invisible, so you just get the value from the product. That's our vision, and because of that, we started kind of thinking about, well, how can you set up an ESOP just with one click? How can we build the contract so they're actually integrated into the cap table? So we built a contract engine behind the scenes. It was super hacky in the beginning. It was using Google Docs and an API, which was not built for that at all. So every time I tried it myself, I was scared it was going to break, but it worked well enough to see there was a demand and that people really want this and that way of thinking. That while equity needs to transact hands, that's where the power of it. It's not just a static cap table. So building the flow in, building the contracts in, building the signing–all these things that do need to happen, building them together with the ownership is really where the power is. So we built these one-click concepts. We still have very far to go, but it's at least an incredible, delightful experience now, especially compared to some other platforms out there.

Jason Atkins: We've come far. Yeah, we have. Just thinking through the journey and the vision, it was always our vision to create global borderless equity, and that was born from the crypto space. I don't want to connect us too closely because it's a bit scary. But what we loved about it was, it was totally global, it was super fast, and you can have capital anywhere it needed to be at any time. And the investor consumer, whoever the supporter, was totally free to do that as they please. And look, it has a whole raft of issues that we're not going to go into, but the speed, the borderlessness, and the openness were really exciting. That's where we think equity can be in time. Of course, we need to bring the regulations along. We've got the management layer of all the compliance; we've got the execution layer of the transactions, which is the legal agreements; the buying and selling; and all the emotion when it comes to capital raising. Then once you build those, then of course, you can have those higher order outcomes of borderlessness, speed, and accessibility. So anyway, I hope I explained that in a good way, but that was a bit of the journey.

Kim Hansen: Yeah, and two points on that. I think that just by seeing that it's possible to do cross-border things with technology, you got to do the real contract, the real work that is for each region. That's really important to solve. But there's a desire for ownership everywhere and people want to have more liquidity, so that's kind of a strong validation point of how the world is doing. We also want to see a much more diversive and inclusive world, so at Cake, we are super, super passionate about bringing more equity ownership to all corners of the world. There's 8 billion people on this planet, full of energy, creativity, and curiosity, and who knows better about what's good in a local society than the people that live there. So, if we can give them ownership, if we can create liquidity there, they're going to feed that into their ecosystems. And I am absolutely in love with the ripple effect. When you see employees that get ownership, then they eventually liquidate that and go and take some of that, they often reinvest it into other startups. They already have a really good experience, so they're pretty good at judging which startups are good or bad. And they give mentorship, advice, and a lot of them also go and build startups themselves. So this incredible flywheel effect that we've seen also in Australia. Now Canva is going to do a 1.5 billion secondaries, so basically, a big payday to a lot of employees and early investors. A lot of these will have this ripple effect, so it's an amazing thing for Australia. I believe in the upcoming months, it's going to be very, very exciting to follow all of this. We had Christian Lacullo on the panel a few weeks back in Melbourne to show a perfect example of someone who who was fortunate to get ownership in Canva and Atlassian, exited some of that. He invested into Cake and multiple other startups. He's been advising Cake and taking a lot of the experiences he had in Canva, which was so helpful for us. And now, he's gone and built his own startup. What a beautiful story. Imagine we scale this to 1,000, to 100,000, to a million people, right? That's just going to accelerate everything.

Jason Atkins: And when you do tha, globally as well, you can have Australian equity in Africa and in Asia. I saw one of our customers has got their equity up in Nepal. Companies all over the world can be sharing their equity all over the world. It's still hard, but it's getting much easier, especially with platforms like Cake, but it's going to get easier and easier. Its impact globally, societally, economically, it's tremendous. Equity is becoming much more of a real currency to create wealth and distribute wealth much, much better. So amazing. It's such a cool journey.

Kim Hansen: And to go to the report, we can see, you know, it's already matured. The equity understanding has matured a lot in Australia. Now, 61% of employees see equity as an important part of accepting a role, which is just incredible progress.

Jason Atkins: We don't have reports from when we started, but it had to be less than 10 percent. Every single ESOP we saw was broken, every one. I've got an ESOP and they send it to you and they've got the plan rules, no resolution side, no offer letter sent, or even if they did have the offer letter sent, there's no way their team would have any idea.


Kim Hansen: It's on paper in a drawer somewhere that nobody understands. At least now, we can see, we can track it a little bit. It's still only half of the people that actually understand the value of it. We have to really help both founders and employees understand the value of it or communicate it well around it, and celebrate the successes along the way together as a team. We're creating this ownership, we're being able to define our destiny and success a lot through that, so that's super powerful and exciting.


Jason Atkins: Well, let's pull out some of the top stats, Kim. Have you got them there? I've got them here. Let's run through some of the key findings. Obviously, we won't dig into it too much. It’s our first big report, so it's not like a thousand pages like the cool Cutthroat Ventures dudes the other day, but I think it's still a massive step forward, and I'm so excited for the Australian ecosystem that there's more and more data available because we need it to make decisions and build the community. So glad to be part of the solution. What were the headline numbers, man? Let's run through them.


Kim Hansen: Yeah, as I mentioned, you know, 61% see equity as very important in the acquisition process as part of the negotiations, which basically tells us that if you're a startup now, you need to be able to offer equity ownership because people will expect this, and this is going to grow a lot. 54.6% of employees are highly motivated from it. Already coming from very, very little. Again, there's room to grow, but the power of that is just incredible because you can retain them in your company even though you might pay them half the salary that they can make in a corporation.

Jason Atkins: How does Cake help with that? Normally, I wouldn't promote Cake too much, but I do have two Cake founders on here. How does Cake currently help? Because we're working in that space constantly at Cake. It can't just be a record-keeping platform, it's so boring. How do we help motivate, engage, and retain people? Okay, what are we doing? What experiments are we running?

Kim Hansen: Yeah, I think it's really visualizing what equity is in much better ways. It's more about people and that motivation and saying, here, me as a founder, I'm going to give you ownership in this awesome thing that we're building. And this is the mission we have together. When you include it in the culture and say, “Hey, what are your dreams?” “I want to buy a house or something like that.” Great. Those are the financial outcomes. How do we track the value of it? So we're constantly iterating on an employee app where you can see every month how much you're owning. You know, you have another vesting happening, so your ownership is growing. What does your portfolio look like? What could it potentially become? And then more than that, you know, those kinds of celebrations together, that emotional feeling around that typically happens around the team and especially through founders and employees to say, “Hey, I'm giving you this ownership.” Then you can easily communicate that forth and back between the employees and the founders through the app. So you're attaching the emotion to that kind of dry number that is not so meaningful before, but there's kind of liquidity happening. So it's really building a lot of those features to visualize it and understand it better. As we can see, only half understand the value of the equity. So now, we have a lot of little hints and easy breakdowns of what the different terms mean. So you can at any time, just read those through the app.

Jason Atkins: That's an important part. What's vesting? What's exercising? How do I do that? Do I have a tax problem? They have so many questions and a lot of that information is now in the app. They can see it right there next to their holding. It’s taking the responsibility off the company because it's hard to do this communication all the time, plus they might not even know. Putting it right there in the hands of the team member so they can be like, “Oh, okay, I get it now. I don't have a tax bill because I've got a cool ESOP and the company's taken the time to settle out well for me and communicate with me. Okay, maybe I will work hard to increase its value, those sorts of things.”

Kim Hansen: And even more now, we have built a database of many stakeholders, more than 150,000 on, we track all the transactions, and we have good insights to how well the companies are doing, how they're using the equity to grow. So really taking all that data, which we're giving out in reports to help the ecosystem, but we're also using it to guide startup founders so they don't have to make these complicated decisions and to understand how much do I need to give an engineer we're just providing a perfect little guideline. Normally, inside this is the best practice for you to use this. You have a little slider and you can just say, go. So this is a huge progress from just, well here, put in an input field, how much are you going to give, right? You have no clue or you have to go and read all these long blocks to try and understand, figure out for your startup. So we're just using this data to make it more and more intelligent so that we can help you make those decisions and just stay within the best practices and standards. So you can just focus on the cool stuff of building great products together.

Jason Atkins: Nice, nice. What other couple of stats you got for us, mate? Help people unpack this report.

Kim Hansen: After COVID, I think we've seen a shift in how people are thinking with remote work. So there was a bit of forced remote work, but then people are seeing the advantages with that as well, and then they desire that more. They want to have more ownership as well as they're seeing the power of this. We've seen, now we're talking specifically in Australia, we've seen the successes with Canva and Atlassian. A lot of people are talking about this, so there's a bit of power to the people ground up happening. People are searching for more purpose. They're searching for lifestyle. COVID was a hard slap to a lot of people in the face, and it's not so cool just to sit at home and order and buy a lot of stuff. You actually want to have a more healthy lifestyle. You want to have purpose in the things that you're doing. So there's a search for more meaning in our lives, and I think startups are probably one of the most meaningful things you can possibly do where it's tough, but you step up to the challenge and become the best version of yourself. So we've seen incredible growth in the usage of equity in the last couple of years, especially accelerated after COVID.

Jason Atkins: Let's do one more stat. I've got one here. 34% of founders think they communicate the value of their equity effectively. I think it's a cool stat because, look, it's not a bad result because it's very hard to communicate equity. I would hazard a guess that it would have been a lot lower a few years ago, before things have improved a ton. I think we've helped with that. But, you know, there's a lot of opportunity there for founders to learn how to improve more effectively. Let's talk a little bit about that. So for me personally, I often advocate for having a slide in your all hands meetings. People do an all hands, I think maybe monthly plus or minus, talk about the value of your equity every month with your team in the all hands so it doesn't have to be “Hey, the equity is worth x this month, every month” I think that's probably a bit too hectic, but it could be, “There's a raise coming up” or “Our raise has gone successfully”. It could be, “We've hit some great new milestones.” This helps in the value of your equity. It could be helping people understand how they can be rowing together in the right direction to increase the value of their equity. It could be that there's a secondary coming up or even that the leadership thinking, “Hey, 2024 could be a year for a secondary and we're at least working on it.” So bring it to life. If you're thinking about it, let them know, obviously in the right way. And don't overhype it, which is probably the biggest risk. And all you good founders out there will know this for sure. I don't mean to hassle anybody, but you don't want to be like, "Hey, we're worth 100 million and we're going to have an exit for a billion next year” or any of that crap. Of course, I'm stretching that to the nth degree, but keep it real. Keep it fair. If you're not sure, ask–ask cake, customer success people, or even ask him or I. We love sharing our insights. Perhaps ask other great leaders, there's heaps of great accelerators, there's tons of great startup minds in Australia, ask your advisors, go out and ask how you can best communicate that. Kim, any thoughts on how founders can maybe help and educate?

Kim Hansen: I think it's creating that excitement. For me, it's also really keeping it simple. At Cake, we use OKRs and there's various successes out there, but I think we're doing quite well in that. The more you can tie the results, the success of your OKR hitting your targets with the value of your company, and then you can tie each person with their individual KPIs up to the OKRs. You can see how each person can directly influence the value of their own equity, and I think that's super exciting. I think we're already seeing that we've come really far with that at Cake, and I'm hoping that we can really take a lot of those kinds of formulas and build it into the Cake products, and startups out there can have a more simple way of defining what's the value of equity and protecting it a bit. We see a lot in the media of all sorts of valuations depending on the market fluctuations, right? But ultimately, you want to build real value in your company and see how each person can contribute to that, and then, keep it really simple. So I'm very excited about what we're doing and how we can share that with our customers.

Jason Atkins: Nice. Here's a left field one as well. Maybe ask your team, interview them and then get their answers, whether it be anonymous or not. We did one recently where we interviewed a bunch of our team members on what equity meant to them and how it affects them day to day. And the answers that we got were really heartfelt, really warming and really authentic. And it changed my view of how impactful equity was. And you might find that to be a really deep and authentic way to connect your team members together anyway. A little bit out there, but I think it’s kind of cool. All right. So we talked about yourself, Cake, and the report. Let's finish with the report. There were some recommendations. I guess we've given our own recommendations to a degree along the way. I mean, was there one or two of the recommendations at the end of the report that you might want to touch on? Obviously, you can get the report from Kim, or from our website, or we'll put it in the link underneath, but it's on our website somewhere, surely.


Kim Hansen: Yeah, absolutely. I think it's just all about experimenting how you communicate in simple terms to motivate and drive your team. Try and take that value that you're investing every month and make it something real. Celebrate it with a bottle of wine, whenever a new person becomes an owner, or when someone is hitting a big milestone. Experiment with the milestones and tie the goals of the whole company directly to the ownership so we can all just drive for meaning. Yeah, as you said, it was heartfelt to see when we asked our own team how they relate their ownership with their own values and the culture that we have at Cake. So I think it's really communicating a lot more around it and celebrating your wins. Sometimes, we have to remind ourselves of that. We're always just go, go, go. Make sure you celebrate the wins and tie them into the value of your equity.

Jason Atkins: Amazing. So look, Kim, I could talk to you all day. Of course, we love this stuff. We're going to wrap it. And also, I know you're going to go soon. We've already done the CHL segment. What I thought we could do is do a little plug for the Gold Coast where we're based. I know we're a global company, and I love being a global company and I love helping founders and teams everywhere. But we live in a special place and you chose the Gold Coast over lots of other cities, and I'm sure our community here on the Goldie would love it if we could give a little plug. So what was it about the Goldie? Tell us a bit about the process you used on why you chose the Gold Coast and a bit about why it's awesome and how it can be a great home for others like founders and creatives and entrepreneurs.

Kim Hansen: Yeah, I think it's a well-kept secret. It's obviously an incredible weather we have here and I think, for me, personally, at least, having access to nature right out your door is absolutely phenomenal. I used to think that places like these are quite limited because there is not so much knowledge work or technology. And a lot of really smart people typically gravitate towards the cities where they can really make a lot of money. But technology has facilitated so much cross-border communication and work culture,  and we can actually have access to technology here. So I think the Gold Coast is a perfect base to have a little headquarters and build a global startup and leverage technology. A lot of times it can be optimized to communicate when you have limited time to overlap, so you can really be in your creative focus space instead of running around in a noisy office. So, there's challenges with that. I think we're doing really, really well, and I think I want to see a lot more small startups here that maybe have the headquarters here and then, they can still grow globally with remote teams.

Jason Atkins: Love it. Thanks for sharing. Well, just because I wanted to make this little Gold Coast ad, I'm going to add great culture, great lifestyle, five minutes to the beach, five minutes to the hinterland, surfing, mountain biking, and more great people that are innovative. As you say, the pandemic, technology, and remote work has allowed people to move anywhere, so we welcome more great people here. If you do happen to move here or you know someone, please do connect us in. We'd love to see the space grow and grow and grow. Anyway, Kim, look, thanks. I think we've shared some quality insights and got to know you a little bit better. And look, it's great building Cake with you. I'm stoked you could join the pod. And yeah, onwards and upwards for startup teams.

Kim Hansen: Thanks so much, Jase. Awesome to jam with you. Let's do it once in a while.

Jason Atkins: Totally. Cool.

Kim Hansen: See ya. Bye.

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