May 7, 2021
When companies are transparent about their compensation plans, everyone benefits. Not only do candidates have an easier time evaluating job offers, companies have more success attracting and retaining talent.
Unfortunately, pay transparency—especially around equity—isn’t exactly the norm. For us, two software engineers who have worked in high growth tech companies such as Instacart and Uber, our whole careers, a large portion of our compensation over the years has been equity-based. We’ve seen the life-changing power of equity firsthand, but we’ve also experienced the risks and pitfalls of standard compensation systems. That’s why we’re on a mission to change that with the launch of Figure.
Through this new platform, companies can structure their compensation plans and communicate them to candidates and employees on an ongoing basis.
Receiving equity in a company is great in theory, but complicated in practice. We’ve gone through some amazing interview processes throughout our careers, only to receive highly technical, plain-text offer letters at the end stating that we have 10,000 stock options—with no context around what that means.
The majority of companies don’t share enough information with their candidates and employees about what equity is and how it works. There are two possible reasons why. If companies don’t want to reveal too much about their equity systems to the general public, they might take a more conservative approach when talking about equity. However, more often than not, companies simply don't have the resources or structures in place to effectively discuss equity with their people. And when they do - these resources are largely manual, oscillating between powerpoints and excel spreadsheets - preventing HR and compensation teams from scaling them effectively.
It makes sense. Equity is a tricky topic to understand, let alone explain to other people. In the context of private companies, equity is even more confusing. Employees might have to purchase their stock and hold onto it for a long time before they can sell it, not to mention dealing with potential tax implications. Many recruiters don’t fully understand how equity works, so it’s no wonder that candidates don’t.
This lack of education has a profound ripple effect. When people don’t know the value of their equity, they’re less likely to take advantage of it. In fact, 74% of employees said they’d like to have online access to equity education and tools, but only 46% of employees said they’ve received information and advice about their equity plans.
On the flip side, more information translates to greater employee satisfaction, especially around money. A whopping 75% of employees who received equity advice from their companies felt more confident making equity decisions, and 80% of employees who received advice felt good about their financial situations overall.
After years of receiving equity-based compensation with little information or guidance, we wanted to create a solution that promotes pay transparency. Companies need a better way to structure, manage, and explain their compensation plans. That's where Figure comes in.
Our platform gives companies the tools to educate candidates and employees on their total compensation—including equity, salary, benefits, and bonuses—in a dynamic and exciting way. With customizable, interactive offer letters, we make it easy for companies to give their people the information they deserve. Plus, our compensation management system helps keep everything running smoothly post-hire, and for their existing employee base. This allows companies to easily manage their compensation bands and prevent pay inequities.
It’s a win-win. When companies have the right tools, it’s easier to educate employees. And employees who understand their compensation are more likely to invest in their company’s success. Ultimately, pay transparency can lead to greater employee retention, higher offer close rates, and a more satisfied, motivated workforce.
Investors see massive upside for Figure and this space too. That is why we are so excited that today we are announcing that we’ve secured a $7.5M seed round investment led by CRV - the investors that backed exciting companies like DoorDash, Airtable, Patreon and Drift early on. CRV general partner Anna Khan will also be joining Figure's board of directors.
At Figure, we’re harnessing the power of technology to make compensation simple, equitable, and transparent. We’ve raised a total of $7.5 million in seed funding so far, and we’re excited to continue serving new customers.
If you’re part of a forward-thinking tech company that needs compensation help, check out our solutions today. We’re also looking for passionate software engineers and sales reps to join our team. If that’s you, you can see our job listings here
Today, we’re excited to announce Agora has been acquired by Payscale, one of the leading compensation data, software, and service providers.
Agora helped Turquoise translate complicated spreadsheets and equity program details into consolidated offer letters with built in modeling tools.
Simplify your compensation practices and effectively communicate total rewards to your people.