The amount of equity points they earn will depend on the team member's equity rate (in dynamic time), the point value of the task (in dynamic task), and the equity incentives (e.g., multiplier and early logging bonus) that are currently active. Team members with higher equity points will have a larger share of the allocated equity in the dynamic pool.
Amy, Bob and Chris have an equity rate of 20, 30, and 50 points per hour worked, respectively. They are all members of a dynamic equity pool with a total allotment of 10,000 shares. Let’s assume that they were all hired together on the same date and immediately started working and logging their time.
One week later, Amy was able to record 50 hours of work, Bob with 40 hours, and Chris (who did not feel as productive that week) with only 10 hours. In addition, Bob was able to finish a major preset or predetermined task that week which was worth 1000 equity points. As of that point of time, the possible distribution of the allotted 10,000 shares would look something like this:
In a dynamic equity pool, the allocation of company shares to team members in the pool will depend on the amount of equity points they are able to earn. Team members can earn equity points by logging their time spent working (time-based dynamic equity) or by checking off a predetermined task (task-based dynamic equity).
Dynamic equity pools are called as such because the distribution of the allotted shares to the members of the pool will change over time. What matters most is the final tally of the equity points upon the occurrence of the final vesting trigger. They only become fixed once all the vesting triggers (conditions) are met. That’s when a final distribution of equity is made. Thus, in the illustration above, the split of the 10,000 shares would change if, for example, Chris is able to earn more equity points in the future, before the pool is frozen for a final landmark event such as when the company is acquired or conducts an IPO.