Vesting Schedule

A vesting schedule outlines the fixed period in which employees vest their shares, or in other words unlock the right to purchase a portion of their equity. Most vesting schedules for an early-stage startup are four years, with a one year cliff, and monthly vesting after the cliff.In this example, the employee “unlocks” 1/4th of their stock after one year, and 1/48 of their stock each month thereafter. If they leave after 1.5 years, they have unlocked the ability to purchase 9/24ths of their stock, and forfeit their unvested shares.In recent times, Coinbase, Lyft and Stripe have reevaluated the traditional approach and have offered their employees a one-year vesting schedule. We expect this trend to continue.

Other Terms