ESOP SPV

ESOP Plan Designed With Special Purpose Vehicles

Set up your ESOP SPV with our expert consultants today

Aiming to improve your Employee Stock Option Program but worry about a complex captable? QAPITA’s new and improved product – ESOP SPV – sets up a Special Purpose Vehicle (SPV) entity within your employee share plan. Speak to our advisory team to discover how issuing an ESOP SPV can compound future benefits for your business.

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The Problem

3 Key Misconceptions Founders have when Structuring an ESOP Plan

First-time creating and implementing an ESOP share plan? Some decision makers may not even be aware of the various options and methods available to them to execute and launch the most effective employee stock option plan structure.

Here are the most common misconceptions we find that decision-makers in Singapore have when it comes to structuring an effective ESOP plan:

Providing ownership to employees is a hassle

At first glance, founders may not know how to best navigate the process of providing ownership to employees.

This process often leaves the impression that multiple shareholder names will be present on the captable.

I am unaware of alternative methods to set up my ESOP

Founders are often unaware of alternative solutions and vehicles (e.g., trusts or SPVs) available for them to launch an optimized ESOP plan.

They are uninformed about the various methods to host and launch their ESOPs in the most streamlined manner.

Executing alternative methods requires extra workload

A common misconception is that there is administrative hassle and additional paperwork with setting up a vehicle.

Setting up an SPV doesn’t have to be complicated. In fact, SPVs minimize administrative hassle, reduces friction when closing fundraising rounds, and presents a sense of operational maturity to investors and stakeholders

The Solution

Introducing Qapita ESOP 2.0 - SPV Launch

To provide an alternative structure for startups in Southeast Asia, Qapita has launched a brand new ESOP SPV product specially for Singapore-incorporated companies. Speak to our advisory team to discover how issuing an ESOP SPV from the very start can compound future benefits for your business.

Smooth and straightforward set-up

Qapita sets up your Special Purpose Vehicle entity within your ESOP plan, which simply groups up your shareholders and structures your employees’ shares for an investor-ready captable.

Concise and cost-effective

While ESOP SPVs are not an uncommon practice, many founders are unaware that this is an option that can be easily implemented via a vehicle. Trusts are more expensive and often do not justify the cost, especially for an early-stage company.

Support every step of the way

For first time founders in particular, issuing and launching a share plan may seem confusing and complicated. Qapita’s team of experts can help map out the process and evaluate the various scenarios that can be used to design or improve your company’s share plan.

How it works

Qapita ESOP SPV Key Features

An improved version of the traditional ESOP structure, the Employee SPV has a direct stake in the company, while the ESOP pool is distributed amongst the participants within the Employee SPV.

Structuring your ESOP under an SPV provides several meaningful advantages, particularly for early-stage and growth-stage companies managing equity and investor relations during due diligence and fundraising rounds:

Consolidated & Clean Captable From the Ground Up

Balance Clarity and Dilution with Tailored ESOP SPVs

A strong plan helps opitimise ESOP structures so that you can reward your employees without being exposed to unnecessary risks. Your employees can hold shares of the SPV but their individual names would not be present on the captable, resulting in neat captables that come in handy during fundraising.

Easily Replicate ESOP Trusts for Simplified Shareholder Governance

Support every step of the way, including SPV setup and paperwork

SPVs result in cleaner documentation and accurate data, making it easier to manage audits, board reviews, future fundraising rounds and potential liquidity events. This is a smarter alternative structure in comparison to Trusts, which incurs higher costs.

From Framework to Stakeholder Approval

Attract Top Talent with Understandable Equity

A well-designed ESOP compensation structure increases visibility on employee ownership amongst your workforce and stakeholders, all while consolidating shareholder names in a single SPV entity. This structure provides a right for employees to easily exercise their stock options, allowing them to become shareholders of the SPV.

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Benefits of setting up an ESOP SPV with Qapita

Maximize Future Tax Advantages in Singapore

Qapita sets up your ESOP SPV tailored to your company’s growth.

ESOP SPVs enable future tax savings, especially in Singapore. This is particularly meaningful in a scenario where shares are exercised by employees within the SPV.

Increase Ownership Visibility and Employee Retention

Your employees gain a tangible sense of ownership as they have clear visibility on themselves as investors of the firm.

This happens all while employees stay consolidated in a single SPV entity, without having dozens of their individual names listed as shareholders.

Make ESOP Plan Design Concise and Cost Effective

Setting up an SPV doesn’t have to be complicated. In fact, SPVs minimize administrative hassle and showcases operational maturity, which helps to reduce friction in closing fundraising rounds.

It is a cost-effective, concise, and investor-friendly structure to present your ESOPs.

Get started with Qapita today

Do either of these scenarios sound like you? Here’s how you can get started:

I have yet to design or launch an ESOP Plan

I have yet to set up and incorporate an entity in Singapore.
I want to explore a cost-effective and hassle-free solution for ESOP design from the start.
Speak with Qapita today to understand your launch plan scenarios.

Book a chat with our consultant

I have an existing ESOP Share Plan

My holding company that issues ESOPs is a Singaporean entity.
I want to explore ways to maximize future tax advantages in Singapore.
Speak with our advisory team today to prepare documentation for SPV setup.

Get expert advice on SPV setup