The Spotify Employee Stock Option Program for the win!

We are very proud of our Employee Stock Option Program. We offer options to all permanent employees, every single one. Because the reason for our success is the efforts from all our employees, so they should all be able to be co-owners and take part in any future success too.

But running this program has not always been easy. The administration is a bit complicated in a global company. And stock options are so much harder to value than cash. Especially when you are a private company like we are. So this has been a learning journey for us together with all the amazing Spotify employees who have been part of the program. This is one of the reasons why our employees have such a deep understanding of our business (and of tax laws in various countries…).

Hard work and innovation pays off

The team that runs the program have had to both work hard and get very innovative to make this all happen and keep everyone up to date. So I was nothing less than thrilled when someone external noticed them too and gave them the finest award an employee stock option program can get: The Global Equity Organization’s (GEO) “Best use of a share plan in a private company”!

But we are not done yet

In the team, the feelings are a little mixed right now. It’s great to get acknowledged for being at the very top of our peer group. At the same time, we can’t rest until all our employee has a great equity experience.

So now that we have celebrated the award, we will get on with it. We will continue with our roadmap towards world class program execution, communication, and support to our employees as we grow. And when we get tired, we will take a break and look back at how the GEO described our work, and then we’ll get right on it again.

This is what the GEO said about our program:

In order to encourage employees to share the same passion and vision as their founders, Spotify rolled out its inclusive Employee Stock Option Programme to all permanent employees across 22 countries, with a warm invitation to become a co-owner of the company.

Spotify employed considerable effort to make it easy for employees to get the right information on their equity. This is evident by the level of investment in its equity platform and the carefully designed and informative booklets, articles, learning sessions and videos, all of which provide a clear explanation of how the plan works and outline possible scenarios that the participant is likely to encounter or be concerned about.

The plan communications not only reflected the Spotify brand, but also the company’s culture and musical roots. Featuring the co-founders and CEO and Chairman of the company, the video promotes the two-way benefits of investing in the plan in a straightforward, honest, passionate and persuasive manner. The brochures are ‘written in human, with just a splash of legal’, further emphasizing Spotify’s desire to keep the content easy to understand on all levels.

The plan design’s innovative feature of allowing the graduated quarterly vesting and exercise of shares until a participant leaves employment were also impressive.