Phantom shares track value and pay out in cash when it’s real – on exit, funding, or milestones you choose. We design a company phantom share scheme that fits your budget, motivates the team, and won’t tangle your share capital.
When to use this
- You can’t (or don’t want to) issue equity but still want people sharing in growth.
- You need coverage for advisors, international hires, or contractors where options don’t fit.
- You want a simple pool with a known cash cap and a cap table that stays readable.
What’s included
Plan rules that make sense. Vesting cadence, performance hooks where helpful, how awards accrue, and when they lapse.
Event triggers. Clear payout events (sale, funding, revenue/EBIT milestones) and how partial payments work if only some targets land.
Leavers, malus and clawback. Firm, fair rules you can use on a bad day.
Award paperwork. Board approvals, grant letters, schedules of awards, and a clean admin tracker.
Valuation & payout method. The formula you’ll rely on—sale price, last-round value, or a simple model we document and keep on file.
Payroll & tax note. How PAYE/NICs will be handled, net vs gross payments, and a short handover for finance.
Pricing (fixed fees; bespoke available)
Phantom plan setup + first grants – from £1,950 (ex VAT)
Valuation/payout methodology note – from £450 (ex VAT)
Event payout pack (per event) – from £450 (ex VAT)
Annual admin & statements – from £350 (ex VAT)
Prefer a different mix? We’ll scope a bespoke bundle against £275/hr and convert it to a single fixed fee you approve.
How we deliver
Discovery. Goals, triggers, budget, who you want to include.
Design & paperwork. Rules drafted, approvals prepped, grants readied.
Operate. Statements issued, tracker maintained, and payouts calculated when events hit.
Timeline
Inputs this week; first drafts follow quickly. With approvals in place, grants can usually be issued within a few working days. Payout events get priority treatment so numbers are signed off before any announcement.
Inputs we’ll need
- Headcount and who’s in scope (roles, start dates).
- Budget for the pool and any cash cap.
- Target events (exit, funding, revenue/EBIT metrics) and timing.
- Notes on overseas hires, payroll platform, and approval cadence.
FAQs
Is a phantom share the same as equity?
No—it’s a cash bonus linked to company value or milestones. Nothing is issued, so the cap table stays as it is. Payments are typically employment income through payroll (PAYE/NICs). We’ll set the paperwork so finance isn’t guessing on the day.
How do we decide the payout value?
We agree a method up front and write it down. For exits, it’s usually the sale price net of agreed costs; for non-exit events, you can use the last funding round value or a simple formula tied to revenue/EBIT. The key is clarity, not cleverness.
What happens if someone leaves before an event?
Your rules decide it. Unvested awards usually lapse; vested value may be paid only on a future event, sometimes at a discount for bad leavers. We’ll set outcomes you can apply consistently—and we’ll add malus/clawback so serious misconduct doesn’t get rewarded
Understanding Phantom Share Schemes
Board pack due Friday. Cash is tight, hiring can’t wait, and you don’t want another class on the cap table. That’s when a phantom share scheme earns its place. Call it phantom stock, synthetic equity, or a cash-settled bonus plan – the idea is the same: track company value and pay cash when value is real.
We start with facts. Who’s in scope (employees, a long-standing adviser, maybe two contractors overseas). What the business can actually afford this year – and next. Which events unlock payment: a sale above a set price, a funding round over an agreed pre-money, or operating milestones that matter (MRR, EBIT, product adoption). Then we write rules you can run without a spreadsheet breeding on its own.
Operation is where most plans fall over. Ours don’t. Vesting follows a rhythm you’ll remember. Leaver, malus and clawback are drafted for bad days, not just tidy ones. The value formula is written in plain English – sale price after agreed costs; or last-round value; or a simple metric you’ll defend in diligence. Payroll gets a one-page memo on PAYE/NICs, net vs gross, and timing. No improvisation at 09:12 on announcement day.
the roll out of a company phantom share scheme for a scale-up with hires in London and Porto might look like this: Monday: set the cash cap and triggers on a 30-minute call. Wednesday: rules and grant letters out, tracker saved as Phantom_Awards_Apr_v3.xlsx. Friday: board sign-off; statements in inboxes so people could see vesting and notional value. No theatrics. Just steady movement.
One boundary we hold: we won’t promise numbers a budget can’t carry. Better a smaller award with a clean trigger than a glossy IOU.
Done properly, phantom share schemes give you upside sharing without touching the register. Done poorly, they turn into fog. We prefer the first version: clear triggers, a fair formula, paperwork you can operate – and money that lands when value does.
