Vesting is one of the most important equity mechanisms a founding team can implement — and one of the most frequently skipped. The argument for skipping is always trust. The argument for implementing it is simpler and stronger: it costs nothing when everyone stays, and it prevents catastrophic outcomes when someone leaves.
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The industry-standard founder vesting schedule is four years total with a one-year cliff. The cliff means that none of the equity vests until twelve months have passed — if a founder leaves before the cliff, they leave with nothing (or the company can buy back unvested shares for a nominal price). After the cliff, the remaining 75% vests monthly over the next three years. This structure is well understood by investors and lawyers and should be the starting point for most founding teams.
The one-year cliff serves two purposes. First, it filters out founders who weren't truly committed — they leave before the cliff and the cap table stays clean. Second, it gives the founding team a year to evaluate whether the original equity split was right before anyone becomes fully entitled to anything. If something is clearly wrong with the team dynamic by month ten, the cliff gives remaining founders a window to address it.
Acceleration provisions allow vesting to speed up under certain conditions. Single-trigger acceleration means vesting accelerates immediately upon an acquisition. Double-trigger requires both an acquisition and a termination or significant role change — so a founder who is retained post-acquisition doesn't get an immediate windfall, but one who is pushed out does. Most investors prefer double-trigger; most founders want single-trigger. The compromise is usually double-trigger.
| Single trigger | Double trigger | |
|---|---|---|
| What sets it off | An acquisition, on its own | An acquisition plus a termination or significant role change |
| Founder retained after the acquisition | Vesting accelerates anyway | No acceleration — they keep vesting |
| Usually preferred by | Founders | Investors — and it's the usual compromise |
Tracking vesting manually becomes unwieldy as soon as you have more than two or three grants active at different start dates. Equafy manages vesting grants as a first-class feature: each grant has a start date, cliff, total shares, and vesting schedule. When shares are issued in a new round, the system recalculates the percentage each vesting grant represents so the cap table stays accurate without manual intervention.
Vesting grants as a first-class object
Tracking vesting by hand gets unwieldy past two or three grants with different start dates. In Equafy each grant carries its own start date, cliff, share count and schedule — and percentages are recalculated automatically when a new issuance changes the total.
Yes, including the most senior founder. Investors expect it and will often require it as a condition of investment. Having one founder exempt from vesting is a red flag in due diligence.
Unvested shares are typically cancelled or returned to the company's treasury. The company may then redistribute them to the reserved pool for future grants or cancel them to reduce total outstanding shares.
In theory yes — founders can agree to voluntarily vest already-issued shares by creating a repurchase right for the company. In practice this requires agreement from all parties and legal documentation. It's always easier to set up vesting at incorporation.
Equafy tracks vesting grants per member with configurable cliff and schedule. When total shares change due to a new issuance or round, vesting grant percentages are automatically recalculated to stay consistent with the new total.
Equafy manages vesting grants, tracks cliffs, and keeps percentages accurate as your cap table evolves — so vesting never becomes a spreadsheet nightmare.
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