PCA Predict provides address validation technology used on e-commerce sites, for customers that include Tesco, Dow Jones, and Disney. The organisation, which has offices in Worcester and New York, and employs over 55 members of staff, offers an enterprise management incentive (EMI) scheme.
The EMI scheme was chosen as a way of motivating staff through the generous tax incentives it provides to encourage wider share ownership. Guy Mucklow, co-founder of PCA Predict, says: “It has been proven that employee-owned businesses are consistently more productive, innovative and profitable than those that that are not. One of the main reasons for this is that employee shareholders treat the business like it’s their own.
“They care more about the [organisation’s] future and understand how their financial and career paths are inextricably linked to the success of the business. If we can get to that point, then we will create that virtuous circle where everyone will benefit.”
The organisation decided to kickstart the scheme by gifting up to 10% of equity to employees. Mucklow says: “It is a fairly unusual arrangement in that with most EMI schemes, employees are expected to pay something for the option. By gifting our equity, it means that there is immediate value in the share award and that, ultimately, unless the business is worthless when we sell, the share options will provide a good return for our employees.”
To illustrate, an employee who received 0.01% of the equity on the first round that was paid out last May, would have received approximately £6,000 of immediate value for their shares based on a valuation received in December 2015.
Mucklow says: “We are very keen to ensure that we have the best talent and that we do our utmost to share our success.”