We prioritize long-term opportunities, allowing hackers to grow alongside the company. Through our Equity Earning Strategy, hackers can reinvest their bounty winnings back into the company and increase their stake. This structure not only rewards contributions but also provides access to future financial and strategic benefits.
How It Works
When a hacker team wins a bounty, they are presented with two choices:
-Claim the bounty in full: Receive the bounty as an immediate cash reward.
-Reinvest the bounty: Reinvest part or all of the bounty back into the company in exchange for equity.
Reinvesting allows hackers to earn more points in the Gamification Scoring System, unlocking additional benefits such as:
-Paid travel expenses to global hackathons and cybersecurity events
-Access to advanced hardware and software
-Increased visibility and influence within the hacker community
Reinvest for More Than Equity
Earning equity not only contributes to your financial future but also plays a significant role in your status and reputation within the company. By reinvesting, hackers gain access to key resources and perks, including:
-Cutting-edge tech tools
-Fully funded trips to global hackathons and cybersecurity challenges
Voting Power for Top Performers
Equity also brings voting rights to top performers. The highest-ranking hackers based on bounty wins, reinvestment, and overall performance will receive voting rights annually. These rights allow hackers to:
-Influence major company decisions
-Shape Algosize’s strategic direction and operations
-Vote on board members who steer the company
Equity Tiers
1. Phantom Equity (Novice Hacker to Skilled Hacker)
-Explanation: Phantom equity provides hackers with a share of the company’s financial success without transferring ownership or voting rights. Hackers can benefit from the company’s growth by receiving payouts based on the value of real shares, though they don’t hold any official stock.
-Vesting: Typically, phantom equity follows a 1-year cliff and 4-year vesting schedule, ensuring long-term engagement.
-Advantages: This type of equity ensures hackers are financially rewarded without diluting control or giving away actual ownership in the company.
2. Class B Non-Voting Shares (Expert Hacker)
-Explanation: Hackers who reach the Expert Hacker tier receive Class B shares, which grant ownership but come without voting rights. Class B shares allow hackers to earn dividends and benefit from company growth but without affecting major decisions or company control.
-Vesting: A 1-year cliff followed by 3-year vesting applies.
-Voting Power: Limited voting rights on minor operational matters.
3. Class A Voting Shares (Elite Hacker and above)
-Explanation: At the Elite Hacker level, hackers are awarded Class A shares, which come with full voting rights on strategic company decisions, such as electing board members and shaping the company’s future direction. These shares give hackers a stronger voice in the company’s governance.
-Vesting: A 1-year cliff followed by 3-year vesting applies.
-Voting Power: Full voting rights on strategic decisions, including leadership elections, company policies, and funding rounds.
4. Founder’s Shares with Enhanced Voting Rights (Admin)
-Explanation: Admins hold Founder’s Shares, which are designed to provide enhanced voting power (often 10x voting rights compared to Class A shares). This ensures the founder and key executives retain control over high-level decisions, regardless of the distribution of shares.
-Vesting: Immediate vesting applies.
-Voting Power: Highest voting influence, with control over strategic decisions, leadership changes, and company direction.
Other Governance and Control Strategies
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Issue Non-Voting Equity
-Hackers can earn non-voting shares (Phantom or Class B), providing financial rewards without transferring control. Non-voting equity allows hackers to benefit from company success without influencing business decisions.
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Use Different Share Classes
-Class A shares provide full voting rights, while Class B shares offer equity without voting power. This system allows the company to issue shares widely while retaining centralized control over key decisions.
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Cap Voting Power
-You can cap the total voting power that hackers can accumulate, ensuring that the majority control remains with founders and core stakeholders. Hackers can receive voting rights, but their collective power is capped to protect company governance.
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Phantom Equity Plans
-Phantom equity ensures hackers receive payouts based on the company’s growth without issuing actual shares or diluting ownership. This model is ideal for rewarding performance without transferring voting rights.
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Voting Trusts
-Hackers can hold shares, but their voting rights are transferred to a trustee. This trustee (e.g., a board member) retains control over voting, ensuring the founders maintain control over strategic decisions.
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Limit Voting Power by Time or Performance
-Voting rights can be granted over time or based on performance, ensuring only long-term, high-performing hackers gain significant influence.
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Restrict Voting to Operational Decisions
-Hackers can be granted limited voting rights on day-to-day operations but restricted from major decisions like board elections or strategic shifts.
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Use an Advisory Board
-Hackers who achieve the top ranks may be invited to join an Advisory Board, where they can provide input on technical and product matters without holding formal voting power.
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Set Vesting Schedules with Cliffs
-Equity for hackers should follow vesting schedules, with a common setup being a 1-year cliff and 4-year vesting period. This ensures hackers commit long-term before receiving any significant ownership.
