Open Source CEO by Bill Kerr- Posts
- Let's Talk About Benefits, Baby
Three benefits everyone should have to supercharge their culture. 💅🏼 #
👋 Howdy to the 4,225 new legends who joined since our last edition! You are now part of a 454,990-strong tribe outperforming the competition together.
LATEST POSTS 📚
If you’re new, not yet a subscriber, or just plain missed it, here are some of our recent editions. 👾 Treating Candidates Well, Post-Training & AI Recruitment. An interview with Sofia Faiman, Recruitment Manager at Athyna.
🍂 [The Startup That Launched Itself](https://www.opensourceceo.com/p/andrew-busse-interview). An interview with Andrew Busse, VP of AI Operations at Hyperagent (by Airtable).
⚓ [The Intelligent Layer In Enterprise Data](https://www.opensourceceo.com/p/ethan-ding-interview). An interview with Ethan Ding, Co-Founder & CEO at TextQL.
**PARTNERS **💫
Every newsletter wants to grow. Few actually do. beehiiv is the platform built by ex-Morning Brew folks who got tired of duct-taping ten tools together, and newsletters running on it grow 2.75x faster.
Referrals, recommendations, analytics that mean something, all in one spot. It's the closest thing to a cheat code we've seen for getting your words in front of more people.
Get 30% off your first three months on beehiiv with the code: BILL30
Your next AI role, picked for you. AI is moving faster than most teams can hire for, and most job boards weren't built to keep up.
The Athyna AI Job Board was. We track openings at frontier AI labs and AI-first companies in real time, match them to your profile, and ping you when a role hits a 75% matching index.
Set your profile once. Less hunting, more building.
Interested in sponsoring these emails? See our partnership options here.
HOUSEKEEPING 📨
New brand for the newsletter is coming along nicely. Well, it’s been a battle, actually. One of our early investors at Athyna runs a great product and design agency, and did a ripping job on the Athyna brand refresh recently. Absolutely nailed it. Building out the new Open Source CEO brand was more difficult. The designs were awesome, but they just weren’t the core of what this newsletter is about. It was too polished. So, I scrapped the entire new brand and am building a brand kit myself around the core identity of this newsletter. Something since day one I’ve been calling ‘Dirtbag Chic.’ New website, and a few more bells and whistles rolling out soon. Couldn’t be happier with the decision.
BUILDING IN PUBLIC 🔎
There are countless ways to improve a company's culture. One of the least sexy ways is to improve your benefits. No one is writing best-selling books on benefits. Twitter threaboiis banging away their keyboards telling people all the ways co-working passes work. But while they may sit behind total comp, and the overall way you treat people, benefits are important.
Feels I get when I use the B word.
That’s why today we are diving face-first into the topic. It wouldn’t be hyperbole to say the benefits package we offer at Athyna goes a long way towards our 90% engagement score averages. For context: that’s world-class. So let’s do it. Open Source CEO, the Benefits Edition.
“Mummy, where do benefits come from?”
Benefits are not a new phenomenon. Benefits, in the earliest sense, began in ancient civilizations such as Egypt, Rome, and Greece. Workers, and especially skilled laborers or soldiers, often received housing, food, or land in exchange for their services.
It was in the throes of the Industrial Revolution, though, that the benefits of today started to take shape. First, really just in the form of safety. Physical safety, and also wage protections. Railroad and mining companies were among the first to offer benefits in the 1800s, primarily by providing company doctors, as workplace injuries were common.
Then came more progressive practices: Henry Ford, of Ford Motor Company fame, began offering higher wages and reduced work hours—hello, eight-hour workday—to attract and retain workers. But it was the 1940s-1950s that benefits really took off. During wartime, wage controls were in place, so companies competed for talent by offering perks like health insurance, pensions, and paid vacations.
Fast forward more decades, and unions led to retirement plans, tech leads to ping pong tables, who knows, maybe in the 2040s we’ll have robot masseuses in every office around the world.
When you think about benefits though, the mind usually goes to the employee. What does the employee get from the company, or what does the employer give to the worker? But that’s a little bit shortsighted. There are huge benefits that go both ways with a great benefits structure. Benefits aren’t a cost; rather, they are an investment.
Another example of bidirectional benefits.
Think about it; better benefits usually mean less burnout, lower turnover, higher productivity, a better culture, and easier hiring. The list goes on. Here are a few stats around some of these factors.
*Note: I pulled these from various sources but skipped the citations. I’ll do better next time, I swear.
| Factor | Benefit | Notes |
|---|---|---|
| Turnover | Average cost to replace an employee: 1.5-2x their annual salary. | Companies with strong benefits report 31% lower turnover. |
| Productivity | Healthy, well-rested employees are 13% more productive. | Employees with good health coverage take 75% fewer sick days. |
| Hiring | 88% of job seekers consider benefits when choosing between jobs. | N/A (couldn’t find a good one). |
| Retention | 72% of employees say benefits significantly impact their loyalty. | Companies investing in mental health see a $4 return for every $1 spent. |
Next, we are going to look at a few key pillars of Athyna’s compensation and benefits programs that have worked really well in keeping our team engaged over the years.
The first benefit I want to highlight is parental leave. The most exciting, but also most stressful, time in a young family’s life is having the child. When building out the company, we wanted to make sure we were taking care of both birth parents, enabling the family to be able to enjoy the time with their newborn kiddo.
*Note: the data in the chart below is from 2019, but similar policies apply today.
Our policy gives 24 weeks of full-rate paid leave for the birth mother and 20 weeks of full leave to the non-birth parent. |
Interestingly, Estonia, Bulgaria, Hungary, and many other European countries have incredible policies, including up to 86 weeks of full-rate leave. On paper, it’s great to look after people, especially taking care of both parents, but in practice it’s even better. See this lovely message from Mailen, one of our recruitment leaders, after coming home from leave to have her second child.
What’s even better is that her husband happened to be our head of finance at Athyna, so he took the time off too. We’ve been through a lot together, he and I, with the last few years being incredibly stressful for long periods, so to see him step away and take some time to enjoy the experience of becoming a father for a second time is very rewarding for me.
The second incredibly powerful benefit we boast is a world-class equity incentive plan. And let me first start by saying how disappointing most equity plans are. They are bullshit in most cases, if you ask me. They are often nothing more than a bait-and-switch.
Companies will often boast, ‘Come and join us, we have great equity,’ but then you find out that: a) the stock is options, so you need to pay, and b) you have a short exercise period after vesting, or they go back to the company’s equity pool. Not to mention early-stage company stock is incredibly valuable, but fraught with danger, as most companies fail. I truly believe that the way to create lasting impact for your team is to build a large, valuable company, and share in the upside.
At Athyna, on day one, we carved out 20% of the company in an RSU (Restricted Stock Units) pool for the team. Most companies allocate 10-15 percent to their equity pool, and most, again, use options. What is the difference between options and RSUs? Well, RSUs are a gift. They don’t need you to pay. We give you a piece of the company.*And—this is kinda nerdy, deep-in-the-weeds technical stuff—we have a double trigger clause in our RSUs to cover any potential tax liability one might have, with the first trigger being vesting, and the second trigger being a liquidity event.
I actually can’t believe people issue options. It drives me nuts. If you come join my company and work your butt off for a number of years, you will be rewarded. This statement rings true from intern to executive.
Source: Cake Equity. This initiative gives our team true ownership and a vested interest in making things work. And getting the company to wonderful financial results in the future. I want the earliest members of our team to be able to go and buy houses with their Athyna stock. And I think we are well on our way to making that happen.
This third opportunity is something that I stole from one of my favorite digital uncles, Scott Galloway. Scott mentioned on his Prof G Show podcast recently that his employer, Vox Media, doesn’t actually pay him regularly; instead, he uses their salary sacrifice program to invest his pre-tax income.
When I heard this, I realized how well this would work as a bidirectional benefit for Athyna to boost working capital, while paying roughly double (when adjusted for pre vs post-tax investing) what investing in the stock market would historically pay per annum. In the vast majority of cases worldwide, people invest their post-tax earnings. So ~30% less than their pre-tax amount. At Athyna, we have an employee investment scheme in which our team can invest a lump sum or divert a small % of their wages to receive a 10% pre-tax return.
Here is a super simple explanation of the math behind the two investment opportunities, using round figures for ease of conversation.
*Note: working off historical stock market returns of 7% per annum.
Option 1 - Investing Post-Tax, Stocks | Option 2 - Investing Pre-Tax, Athyna |
|---|---|
Savings for investment = $1,000 | Savings for investment = $1,000 | Savings for investment after tax = $700 | (kick rocks, tax man) |
Return after 12 months at 7% = $49 | Return after 12 months at 10% = $100 | As you can see, the Athyna investment scenario offers more than twice the return in the same amount of time. The illustration below shows what the impact of that would look like if it played out over time.
As you can see, this works wonderfully as an investment vehicle for the team, and the craziest thing is, there is next to no risk. For Athyna, or any other company, it works great too; to borrow money elsewhere, you would typically pay 13-18%.
💡** ***If you are interested in learning more about how we structure any of these benefits, hit me up with a reply and I am happy to share more. *
It’s very easy to sit here today and talk about all the things that are wrong in the world. And how hard we have it at work. But in the grand scheme of things, we are in a better place than probably any time in history. Hell, most of our ancestors were peasants bound to work on land owned by nobles or lords.
Serf’s up.
Considering this, I think we should be excited about the future. Work, will likely be more and more flexible, with better and better benefits, and if our policy makers—and big tech overlords—do their jobs well enough, it might even be less and less hours as well.
Coffee for all: Coffee breaks became standard in American workplaces thanks to a Pan-American Coffee Bureau ad campaign in the 1950s that convinced employers that coffee breaks would boost productivity.Love me tender: In Japan, some companies offer "heartbreak leave" - paid time off to recover from a bad breakup.Mahalo to the weekend: The casual Friday from Hawaii's ‘Aloha Fridays’ in the 1960s, where workers were encouraged to wear Hawaiian shirts to promote the local garment industry.
How Athyna Makes Remote, Work- January, 2024The Perfect Onboarding In 7 Simple Steps- May, 2024How (This & Other) Newsletters Make Money- November, 2024
And that's it! You can follow me on Twitter and LinkedIn, and also don’t forget to check out Athyna while you’re at it.
BRAIN FOOD 🧠
TOOLS WE RECOMMEND 🛠️
Every week, we highlight tools we like and those we actually use inside our business and give them an honest review. Today, we are highlighting Framer*—the site builder trusted by startups to Fortune 500.
See the full set of tools we use inside of Athyna & Open Source CEO here.
**HOW I CAN HELP **🥳
Hiring global talent:If you’re hiringtech, business or ops talent and want to do it 80% less, check out my startup,Athyna. 🌏See my tech stack: Find our suite oftools & resourcesfor both this newsletter and Athynahere. 🧰Reach an audience of tech leaders:Advertisewith us if you want to get in front offounders, investors and leadersin tech. 👀