Steve Jobs believed that if you want employees to act like owners, you have to make them the owners and he explained this to people attending a conference decades back when stock options weren’t the most popular thing around.
Jobs Breaks Down Mechanics Of Stock Options
Speaking at the International Design Conference in Aspen in June 1983, the Apple Inc. (NASDAQ:AAPL) co-founder fielded a question about giving workers a stake in the company and used it to walk the audience through how stock options work and why he considered them essential to Apple's culture.
Jobs explained that simply selling company stock to employees would force them to risk large sums and even "their life savings" on a single company. Instead, Apple granted options at the current share price, exercisable over four years. If the stock fell or stayed flat, workers could walk away without losing money. If it soared, they could borrow to buy at the lower option price and share in the upside. The options vested 25% a year, he said, effectively tying people to Apple for four years if the stock went up.
Ownership Culture Aimed To Deepen Employee Loyalty
He said the real point wasn't financial engineering but ownership. Jobs told the audience he wanted people to "work for Apple first and your boss second," and that options helped employees feel "this is your… company," not just a place to collect a paycheck.
At the time, he noted, more than 80% of Apple had been owned by employees before its public offering and that roughly half the company was still in their hands. "I don't think finance is what drives people at Apple," he said, arguing that the deeper motivation was building a company that felt their own.
Jobs’ Pursuit Of ‘Insanely Great' Talent
That philosophy carried through his later years running Apple. Jobs focused relentlessly on recruiting "insanely great" talent, articulating a shared vision and creating what he once called the world's "largest startup," a place employees were proud and fiercely loyal to call their own. The view was also a great source of inspiration for Guy Kawasaki, co-founder of Alltop.com, who claims it to be the most important lesson he learnt from Jobs.
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