PART 4: Vesting — Your Safety Net
In a startup, equity should not be given immediately on Day 1. Instead, it should be earned over time, and this rule is called vesting.
Vesting simply means:
Ownership in the company is gradually earned by staying committed and working in the startup for a certai…
PART 4: Vesting — Your Safety Net
In a startup, equity should not be given immediately on Day 1. Instead, it should be earned over time, and this rule is called vesting.
Vesting simply means:
Ownership in the company is gradually earned by staying committed and working in the startup for a certain period.
This system protects the startup from a very common risk — people leaving early but still keeping a large share of the company.
Example: 4-Year Vesting with a 1-Year Cliff
The most common
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