Although my topic is quite broad, the gist of what I say is that companies should hold on to their shares as if they were the Crown Jewels. However, even as I'm speaking I can see that some delegates are sceptical about my message; and during the Q&A at the end, some of them always concoct the most elaborate (and largely unfeasible) mechanisms for dishing out shares now and getting them back at some unspecified future time and value (a recipe for a dispute). My advice is to STOP and take proper legal and accounting advice. Rather than falling over themselves to hand out shares, owners of early stage companies should be doing everything in their power to keep them: they can be very hard to get back.
One of the best-known examples of someone who benefited from this generosity with shares is graffiti artist David Choe, who decorated the walls of Facebook's first Silicon Valley office in 2005. Facebook couldn’t afford to pay Mr Choe in cash so he was given shares instead, even though he though that Facebook's business model was "ridiculous and pointless". They weren’t worth much at the time but he’s thought to have made about $200m when Facebook floated in 2012. That must value his work on a par with Picasso’s or van Gogh’s, and certainly values him more highly than David Hockney as a living artist ($90m for 'Pool with Two Figures').
Now, I’m not saying that you should never pay suppliers with shares, but I am concerned by the willingness with which shares are often distributed to people who have, in many cases, supplied a one-off service to the company and are given an ongoing stake in its value, even if they may have no further involvement in growing that value. If a decorator was painting your hall and staircase you’d be very unlikely to pay him by giving him a part share in the house, so why do it with your business?