What is Upstock?
Updated: Feb 14
Upstock was founded on a core belief: collaborative teams build successful companies. Collaboration arises, in part, when each worker believes they will be justly rewarded in exchange for their hard work.
When teams come together, innovation is born. But for teams to truly unite, they need to feel like they are all in the same boat. Upstock allows teams to trust that they are all getting their fair share, so every worker can focus on helping the company succeed.
Shared company ownership: A powerful tool for collaboration
Shared company ownership (also known as equity) is a critical tool to produce motivation, dedication, and collaboration between team members. Upstock offers tools to make sharing company ownership extremely simple so that teams of all sizes and budgets can effectively join forces to build the next big thing.
Shared company ownership allows workers to focus on a common goal of shared success and help everyone feel like ‘we’re in this together.’ It allows workers prioritize long-term growth of the company over short-term personal gain. And it creates a feeling that workers have gotten a fair exchange for the value they’ve generated.
Upstock: Democratizing access to company ownership
Upstock offers a better way for teams to both share and sees company ownership without having to hire expensive lawyers.
How do we do it? Upstock is a user-friendly technology layer on top of standardized legal documentation, combining Instant Equity Deployment, a Dynamic Value Splitting algorithm, and a compelling real-time Motivational Visual Dashboard.
Upstock has designed a system to optimize trust, efficiency, and alignment between the worker and the organization as a whole. Our innovative software allows any team to create equity pools, divide company ownership, and monitor equity splits and/or profit-sharing directly inside our app.
Upstock is designed to make it easier for businesses of all sizes — especially those with limited resources — to allocate and administer company ownership without the expense or delay of engaging third parties to serve as middlemen, such as lawyers or CPAs.
At Upstock, we believe business legal services like worker equity should be able to be set up and managed with just a few clicks, rather than having to be created from scratch by expensive lawyers each and every time.
How does Upstock work?
Upstock’s system has three core components:
1. Instant Equity Deployment
Upstock allows employers to offer workers legally binding equity with just a few clicks, using documents created by the world’s top equity lawyers. These units can be issued inside our system with just a few clicks, without requiring third parties such as lawyers or CPAs.
2. Dynamic Value Splitting
Upstock’s equity units are then distributed dynamically between workers according to our performance-based algorithm, which measures workers’ input to determine a fair equity split.
3. Motivational Visual Dashboard
This equity split is then displayed in real-time on a visual dashboard, generating a meaningful feedback loop for workers and employers, who start to feel on an emotional level that their work matters truly.
> Part 1: Instant Equity Deployment
One of the main challenges for small- to medium-sized teams who wish to issue workers' shares of the company: It can be both expensive and time-consuming to set up a company-wide equity system.
Upstock allows teams of all sizes to instantly deploy equity to their workers directly inside of the app, without having to hire expensive third parties such as lawyers and accountants.
Traditionally, only a small number of companies, primarily tech startups, could afford to offer shared ownership to their workers. With significant upfront costs, startups in the past often have to pay tens of thousands of dollars to set up a reasonable set of stock option documents.
For most small businesses, it’s no wonder that they are typically stuck offering only napkin-and-handshake agreements to workers, with promises that ‘we’ll figure it out later.’ Upstock allows these teams to legitimize their promises and issue meaningful worker equity with just a few clicks.
> Part 2: Dynamic Value Splitting
How does an entrepreneur determine how much equity to give each worker? At Upstock, we’re passionate about making sure the equity splits remain as fair as possible.
Because Upstock is a technology layer on top of legal documents, we can offer something that traditional paper-based plans cannot: A dynamic value splitting algorithm that fairly slices the company pie according to each worker’s contributions.
Upstock’s dynamic value splitting algorithm dynamically assigns RSUs based on inputs to the system, allowing equity splits to shift over time according to the value that each worker generates. This ensures that they receive a share of the company corresponding with their effort & impact.
Traditional equity plans focus the worker on the vesting calendar (typically resulting in diminishing returns on productivity over time), rather than on day-by-day, moment-to-moment performance. With Upstock, workers are granted a dynamic proportion of equity, shifting according to real-time value contribution, rather than a set amount of shares tied to a vesting schedule. As such, performance becomes the focus rather than a vesting calendar, as workers are granted equity based on time, task, sprints, and/or a landmark event.
The visibility of each worker’s input into the company helps generate alignment with organizational performance, allowing each contributor to see their value creation as it relates as a percentage of the whole.
> Part 3: Motivational Visual Dashboard
Workers can’t believe what they can’t see. One of the most significant challenges with traditional equity systems is that, for most workers, they become mostly dead documents, forgotten in a drawer or online file storage untouched.
Equity is meant to be a motivational tool that allows workers to feel like they’re being rewarded for their effort. However, it’s challenging for employers to generate this motivation if workers have no way of visualizing the amount of equity they are accruing or understanding the trajectory of the company’s overall value.
Upstock’s motivational dashboard allows workers to see and believe in the value of their contributions to the long-term health of the company, giving workers and employers a window into the amount of their equity at any given point in time.
The ability to transparently see one’s share of the business allows all workers to feel bought into the future of the company. As they continue to contribute to impact the company’s growth positively, each worker can view their individual share moving up and to the right.
This enhances the benefits of equity allocation for both workers and employers. Being able to see the organization’s performance, valuation, and pool point rates increase trust in leadership and helps workers believe that performance is being fairly rewarded.
This usually results in both increased alignment and performance across the workforce. Workers can feel that they are headed toward a shared goal: building a valuable company. Workers know that they will receive their fair share when the company succeeds.