Vesting
Definition
Vesting is earning equity over time or milestones; unvested shares are forfeited on departure. The startup standard is four years with a one-year cliff.
How it comes up in fundraising
Vesting applies to employees and founders alike; investors require founder vesting so departed founders cannot keep large dead stakes.
Frequently asked questions
What is standard vesting?
Four years with a one-year cliff: 25 percent vests at month twelve, the rest monthly thereafter.
What is double-trigger acceleration?
Vesting accelerates only if the company is acquired AND the person is terminated; it is the standard acquisition protection for employees.
Cite this term
Round Funded. "Vesting." Startup Fundraising Glossary.
Stable URL, it will not change: https://www.roundfunded.com/en/glossary/vesting
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