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Is there a cost effective software for stock plan administration? We are a small start-up company looking to set up an ESOP.

employee stock option administration software reviews


Achaessa James
Title: Product Manager
Company: National Center for Employee Ownership
(Product Manager, National Center for Employee Ownership) |

There are numerous administration solutions available but which is "cost effective" will really depend upon a company's needs. That is true even if you're only looking at the administration aspect of the program. Each company's needs vary and the functionality of different systems varies widely. The key to getting what's most cost effective for your company's needs is to clearly define those needs first and then do a thorough vendor comparison across the available systems that appear to meet those needs. I've created a comprehensive vendor comparison form that I'd be happy to share with you. I've also designed an equity administration co-sourcing delegation checklist that provides a good understanding of the types of activities involved in managing an equity compensation plan and allows you to get clear about which activities are best to outsource and which activities you want to keep in-house. Send me a private message with your email address if you'd like me to send you either of these templates.

(Vice President of Finance ) |

Hi Achaessa,
I would be grateful if you would share your vendor comparison form. We are a small start up and I'm looking for a solution to manage stock options.
Thank you!

Sarah Jackson
Title: Associate Editor
Company: Proformative
(Associate Editor, Proformative) |

You might want to check out this free report here at Proformative:

"2014 Stock Plan Administration Operational Benchmark Survey"

Best... Sarah

Robert Jevens
Title: Director - Business Markets and M&A Prac..
Company: The Bensman Group
(Director - Business Markets and M&A Practice, The Bensman Group) |

Congratulations on establishing an ESOP. As I'm sure you're aware, studies have shown that ESOPs motivate employees to higher levels of productivity and profitability.

I assume you've already completed the feasibility study and are in the process of structuring the ESOP.

This is a departure from your question and forgive me for being opportunistic here. In the course of establishing your ESOP, be sure to complete a repurchase liability study ("RLS"). And, as a result, establish a plan to FUND that liability.

The purpose of an RLS is to project the emerging liability resulting from the company's legal obligation to repurchase stock distributed to ESOP participants due to death, disability, retirement, termination, or as a result of diversification as required by law and permitted under the terms of the ESOP.

The repurchase obligation is the liability a company incurs as a result of the requirement that it repurchase shares of stock distributed by the ESOP subject to the "put options" required by law. The ESOP can also satisfy this repurchase obligation through cash distributions. The ESOP repurchase obligation represents a claim on future cash flows of the company. Just like other claims on future cash, the ESOP repurchase obligation needs to be quantified and included as part of the company's cash projections. This is one of the leading reasons for failed ESOPs.

In the interest of full disclosure, I do not perform repurchase liability studies. However, I do work with ESOP advisors to design solutions to fund those liabilities.

Are you aware if an RLS has been completed yet?

Achaessa James
Title: Product Manager
Company: National Center for Employee Ownership
(Product Manager, National Center for Employee Ownership) |

Hi, Anonymous. This question occurred to me when I crafted my response to you, but it arises again in reading the latest response to your question. When you say ESOP are you meaning an employee stock option plan? Or do you mean the federally regulated Employee Stock Ownership Plan?

The acronym ESOP is often used casually by people from outside of the United States and people new to equity compensation to refer to employee option plans. However, ESOP is the codified reference to Employee Stock Ownership Plans which are federally regulated under ERISA.

I assumed by your question saying "We are a small start-up company" to mean that you were simply referring to an employee stock option plan and responded from that perspective. As demonstrated by Robert Jevens' response above, ESOP plans are very expensive to implement and are generally not feasible for a small start-up company. In order to ensure that you get the advice you're really seeking, you may want to keep this tip in mind when researching and vetting consultants to assist you with establishing your equity compensation plans - if you're talking about an employee option plan call it an "option plan", if you're talking about the federally regulated retirement plan then you can call it an ESOP.

Achaessa James
Title: Product Manager
Company: National Center for Employee Ownership
(Product Manager, National Center for Employee Ownership) |

Oh, and if you are looking to establish a formal ESOP, then I'd invite you to become a member of the National Center for Employee Ownership ( The NCEO was established 30 years ago to provide specialized education to companies and their employees about ESOPs and has a great bank of educational webinars, publications, and consultant referral lists. DISCLAIMER: I am the product manager for equity compensation products (the non-ESOP programs) at the NCEO.

Robert Jevens
Company: The Bensman Group

Achaessa, excellent point. That should have been the first question.

Topic Expert
Bob Stenz
Title: Controller
Company: Silicon Valley start-up
(Controller, Silicon Valley start-up) |

We (late-stage startup, venture funded) use CapMx (owned by to manage our equity and it works very well and is affordable for a small to medium/start-up companies. We migrated from a system that was mananged by our lawyers. The only negative is that it's not setup for public we would need to migrate should we go public.

(Agent, JKS Solutions, Inc.) |

We implemented Optrack ( two years ago for our ESOP and it has worked out very well. ESOP reporting for monthly and quarterly closes is far more efficient and it spits out all the required note disclosures, eliminating some very painful spreadsheet work. It was also helpful in our conversion from Canadian GAAP to IFRS (it works for US GAAP too).

Very cheap (believe we pay roughly $600 per month, so approximately $7K per year, for over 100 employees) and it did not take long to implement. We simply provided our historical data to them in spreadsheet form and they uploaded into the system...implementation may take a little longer if your historical data is inaccurate.

Elena Thomas
Title: COO/ CFO
Company: Plan Management Corp.
LinkedIn Profile
(COO/ CFO, Plan Management Corp.) |

These responses capture very well the variety both of needs and solutions for equity compensation management. For some vendors the price may vary more by the type of plan (i.e., level of complexity), in other cases it is by the number of participants. Assuming, as Achaessa noted, you meant a stock option plan rather than an employee ownership plan, OptionTrax ( was the first cloud-based equity compensation software on the market; it lets small companies fully manage equity compensation plans, and automates expensing and SEC reporting. It also manages award plans for both private and public companies without the need to change platforms, and can be integrated with InvestmenTrax ( to manage all of the securities transactions private companies also need to track. The software has developed a following particularly for the price-for-value it offers.

As mentioned by both Robert and Achaessa, it's always a good idea to do some due diligence and shop around based on your specific needs.

Juan Correa
Title: Sr. Financial Analyst
Company: Mitú Inc
(Sr. Financial Analyst, Mitú Inc) |

How can I get access to this page. It appears as access denied. Currently searching for best ESOP option that fits my company's needs, really interested in getting access to this report.

(Controller) |

I would like to resurrect this thread. Any more recommendations for good (currently available) stock option software for a small public company? Thanks!


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