A cofounder vesting schedule earns equity over time instead of granting it all on day one. The standard is four years with a one-year cliff: nothing vests for the first 12 months, then 25% vests at the one-year mark, and the remaining 75% vests monthly over the next three years (Startups.com).
You split the equity once. You earn it over four years. Those are two different things, and confusing them is how partnerships blow up.
What vesting actually means
When you and your cofounder agree on a split, you decide who owns what on paper. Vesting decides when that ownership becomes real. Until shares vest, the company holds a repurchase right over them. Leave early, and the company can buy those unvested shares back.
That is the whole point. A cofounder who quits in month eight should not walk away with half the company. Vesting turns a handshake into a schedule, and the schedule does the enforcing so you do not have to.
This structure has been the default since the late 1990s, codified by the NVCA and Silicon Valley law firm templates, and it is now baked into every cap-table tool and financing document you will touch (Startups.com).
The one-year cliff
The cliff is the first 12 months. During the cliff, nothing vests at all. It is binary. Leave on day 364 and you forfeit everything. Stay to day 366 and you keep your first quarter (Startups.com).
The cliff exists to filter. It protects the company from granting meaningful ownership to someone who leaves before they have made a real contribution (Carta). A cofounder who bails inside the first year takes nothing with them. That is a feature, not a punishment.
Name the hard thing directly: the cliff protects each of you from the other. If your partner disappears three months in, you do not want to be raising a seed round while they still own a third of the cap table. The cliff makes that impossible.
The cliff also forces an early, honest conversation. Twelve months is long enough to learn whether you actually operate well together, and short enough that walking away costs no equity. Treat the first year as the trial you both agreed to, not a technicality buried in a signature page.
A sample 4-year, 1-year-cliff timeline
Here is how a standard grant vests, using round numbers. Say a cofounder holds 4,000,000 shares.
| Milestone | What vests | Cumulative vested |
|---|---|---|
| Months 0–11 (cliff) | Nothing | 0% |
| Month 12 (cliff date) | 25% vests at once | 1,000,000 (25%) |
| Months 13–48 | 1/48th of total per month | +75% over 36 months |
| Month 48 | Fully vested | 4,000,000 (100%) |
After the cliff, each subsequent month vests another 1/48th of the total grant until everything is vested at the four-year mark (Capbase). Same 1/48th cadence every month. No surprises.
By Series A, investors generally expect founders to have no more than a portion of their shares vested, so the schedule keeps running as the company grows (Capbase).
Good leaver, bad leaver, and unvested shares
When a cofounder leaves, only the vested portion stays with them. Unvested shares are repurchased by the company, often within a defined window such as 90 days after departure (Capbase).
- Vested shares belong to the departing cofounder. They keep them.
- Unvested shares return to the company or the option pool.
- The board usually holds discretion over the repurchase, which is where good-leaver and bad-leaver terms come in.
How this plays out depends entirely on what you wrote down in advance. The mechanics of a departure, who keeps what and when, are decided by vesting long before anyone hands in notice. If you want the full picture of a cofounder exit, we cover it in what happens to equity when a cofounder leaves.
Acceleration: single and double trigger
Acceleration lets unvested shares vest early, usually tied to an acquisition. There are two flavors (Capbase):
- Single-trigger: all unvested shares vest the moment the company is acquired. Founder-friendly, acquirer-resistant.
- Double-trigger: shares accelerate only if an acquisition happens and the founder is terminated or forced into a reduced role within roughly a year of close.
Double-trigger is the investor-preferred standard because it creates less friction in a financing or a sale (Capbase). Decide which one you want before you have a term sheet on the table, not during the negotiation.
Put it in writing before you need it
Vesting is not a document you file and forget. It is a decision about what happens when a partnership diverges, made while you still align. Protect the company before you need to.
Vesting is one clause in a larger agreement. It sits alongside decision authority, IP assignment, and role definition, and it only works if the surrounding terms are clear. Fold it into the broader cofounder agreement checklist so nothing gets missed, and make sure your vesting terms match the equity split you landed on in how to split equity between cofounders.
The equity split is the headline. Vesting is the machinery underneath it. Get both on paper, keep them current, and you turn assumptions into agreements before a hard week forces the question.
You can start from our free founders-agreement templates and legal toolkits, and use the alignments, Blueprint, and Compass to keep the partnership documented and current as it changes. Document the agreements now. Your future self, mid-fundraise, will thank you.
Frequently asked questions
- What is a standard cofounder vesting schedule?
- The default is four years with a one-year cliff. Nothing vests for the first 12 months, then 25% vests at the one-year mark, and the remaining 75% vests monthly over the next three years. This is what most investors expect to see on your cap table.
- What is a vesting cliff?
- A cliff is an initial waiting period before any equity vests, usually one year. If a cofounder leaves before the cliff date, they walk away with nothing. It filters out people who exit early before they accumulate meaningful ownership.
- Should founders put themselves on a vesting schedule?
- Yes. Founder vesting protects each cofounder from the others. If one partner quits in month eight, vesting means their shares return to the company instead of leaving with them. Investors also expect founders to be vesting at Series A.
- What happens to unvested shares when a cofounder leaves?
- Unvested shares are typically repurchased by the company or returned to the pool, often within a set window such as 90 days after departure. Only the vested portion stays with the departing cofounder.
- What is acceleration in a vesting schedule?
- Acceleration lets unvested shares vest early, usually on an acquisition. Double-trigger acceleration requires two events, an acquisition plus a termination, and is the investor-preferred standard because it creates less friction in financing.
