Dividends make sense for established, profitable businesses. They don't make sense for startups. No one wants the startup to issue dividends.
The employees won't receive any dividends unless they have already paid to exercise their options and are holding restricted stock.
The investors don't want to have their capital returned to them while the company is getting off the ground. They want the profit to be reinvested in growing the business.
The founders are already taking a salary. It is easier for them to fine tune that than it is for them to take compensation in the form of dividends.
Okay, but at some point you need to turn from a startup into a profitable business. This whole problem stems from the fact that these startups are either unwilling or unable to actually become real businesses at some point.
And that should be the actual endgame that is being targeted, and that the employees should be striving for.
Issue one class of share that is restricted from sale but earns dividends (for the employees) and one that is unrestricted but pays no dividends (for investors)?
The employees won't receive any dividends unless they have already paid to exercise their options and are holding restricted stock.
The investors don't want to have their capital returned to them while the company is getting off the ground. They want the profit to be reinvested in growing the business.
The founders are already taking a salary. It is easier for them to fine tune that than it is for them to take compensation in the form of dividends.