Stay with us, but get their IPOs
Bench said he's seen a marked increase in such soft perks, but cautions: "As more and
more companies do it, it becomes less effective." Bench himself faced a retention
challenge a year ago when some employees defected to the networking, telecom, and
enterprise software vendors that are his company's bread-and-butter clients. "It was
the lure of potentially great personal wealth that would attract them to the
manufacturing side," he said.
In response, Bench and cofounder Mike Sawin started the Equity Share Program, which
awards ownership shares in 10 to 20 client companies. Employees earn shares based on
criteria like seniority, position, and whether they were instrumental in signing the
client. Bench, who espouses a share-the-wealth philosophy, said every employee gets at
least an entry-level stake in the equity pool. Bench is legally prohibited from naming
the clients in the pool, but said network-infrastructure companies were deemed the
safest and potentially most lucrative investments. When the companies have a liquidity
event (IPO, buyout, or merger) the shares will be converted to cash. That hasn't yet
happened, but Bench said several companies look promising.
The program gives employees a shot at the wealth that can lure them away, and also
reduces the risk of investing years in a company that doesn't pan out. "They seem very
thrilled about it," Bench said. "They no longer take that [recruitment] call
from a client company."
Bench said some legal firms and IT vendors also use the technique, which should
appeal to other firms in similar situations, such as consultants and system
integrators. Andersen Consulting (New York City), for example, has a program that
awards eUnits -- shares of companies owned by Andersen's venture-capital division.
Mercury computer's Porsche challenge
Some companies are eschewing stock rewards for cold cash or hot wheels. Mercury
Computer Systems (Chelmsford, Mass.), a maker of high-performance embedded systems, is
giving away cars to retain and attract top performers. In April, the company gave two-
year leases on Porsche Boxsters to 20 senior managers and "key technical contributors"
after they met a goal of doubling shareholder value in a year. Other employees can get
cars for two-week periods if they achieve certain goals, such as referring new
The Ultimate Performance Porsche Challenge has generated good publicity and probably
helps with employee retention, though the program is too new to say for sure, said
employment manager Lisa Weingarten. "Senior staff certainly likes driving the Porsches.
Every day that they're driving it, they're feeling good about Mercury," said