Startup Founder Vesting Schedule : 4 years with one-year cliff
What's the most common equity vesting schedule for founders?
4 year vesting with 1 year cliff
If your vesting schedule is different, it will raise questions or at least double glances.
Though widely agreed that this is the most common schedule, there is surprisingly little statistical data publicly available. The closest we can find is a recent post by Carta's Peter Walker- which is based on 500K equity holders from companies that use Carta.
- [Most common vesting details for founder - 4 years with 1 year cliff (or none) ] - Carta (linkedIn Post)
Though there are good reasons to have a vesting schedule as a founder, I was never able to find a good reason on why this is the prevailing schedule (why 4 years? why not 5?). Jake Jolis (@ TechCrunch) mentioned that it may have come from the pre-401(K) era where big company pension plans where incentivized to have 5 year vesting, so startups started to offer 4 years as a competitive move. (he also argues that 4 year vesting should be increased - e.g. 8 years- which I think has merit)
Other sources
most usual vesting schedule is a 48-month period in which 1/48th of the shares vest each month. - Synvest Capital
The norm for founders – and all startup employees – is to have a 48 month vesting period with a one-year cliff. - Capbase
the cofounder vesting schedule is set over 48 months, equivalent to 4 years, where 1/48th of the shares are vested monthly. - Vazi Legal
Vesting schemes are usually four years long with a one year cliff (qualifying period). - Eqvista