Vesting Schedule Calculator
Model a founder or employee grant — cliff, duration, frequency, and acceleration — and watch equity vest month by month, from the cliff to fully vested.
Grant Terms
Used to compute today's vested amount.
No equity vests before this point.
Standard grants run 48 months.
Percentage of the unvested balance that vests immediately on a qualifying exit.
Vesting Timeline
—Vested as of today
Milestones
| Offset | % vested | Shares vested |
|---|---|---|
| Year 1Cliff | 25% | 250,000 |
| Year 2 | 50% | 500,000 |
| Year 3 | 75% | 750,000 |
| Year 4Full | 100% | 1,000,000 |
Note: This calculator is an educational estimate, not legal or tax advice. Vesting terms, acceleration, and their Canadian tax treatment depend on your specific agreement. Have a lawyer draft and review the documents before you rely on them.
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How founder vesting works
A vesting schedule turns a promise of equity into ownership earned over time. Here is what sits behind the curve — and where Canadian rules diverge from the US playbook.
The cliff
A cliff is an initial stretch during which no equity vests at all. Leave before it and you keep nothing; reach it and a full chunk vests at once. The standard one-year cliff filters out early departures before they end up on the cap table.
Vesting frequency
After the cliff, remaining equity vests in installments — monthly, quarterly, or annually. Monthly is the most common for founders and employees because it vests smoothly. Longer intervals mean bigger, less frequent steps.
Acceleration on exit
Acceleration lets unvested equity vest early on a triggering event. Single-trigger fires on a change of control alone; double-trigger also requires the person to be let go without cause soon after. Acquirers usually prefer double-trigger.
Reverse vesting for founders
Founders typically already own their shares outright, subject to the company's right to buy back the unvested portion if they leave. This is called reverse vesting, and the schedule you model here is what governs that repurchase.
Unvested-share repurchase
When someone departs, the company can usually repurchase their unvested shares — often at the original purchase price or a nominal amount. That right is what gives a vesting schedule its teeth and keeps equity with the people still building.
Put it in writing
Vesting terms live in a founder or restricted-share purchase agreement, an option plan, or a shareholders' agreement. A calculator models the math; a properly drafted agreement is what makes it enforceable in Ontario.
What is a vesting schedule?
Vesting is the process by which a founder or employee earns their equity over time rather than owning it all at once. Until shares vest, the company can typically repurchase the unvested portion if the person leaves. Vesting aligns incentives and protects the remaining shareholders if a co-founder departs early.
Why is there a one-year cliff?
A cliff is an initial period during which no equity vests. With a standard one-year cliff, someone who leaves in the first twelve months walks away with nothing; on their first anniversary a full year's worth vests at once. The cliff weeds out short-term participants before they accumulate ownership.
Why is 4-year vesting with a 1-year cliff the standard?
It became the market norm among startups and venture investors because roughly four years matches the time needed to build meaningful value, while the one-year cliff filters out early departures. Investors often expect founders to be on a vesting schedule as a condition of financing.
What is the difference between single-trigger and double-trigger acceleration?
Acceleration causes unvested equity to vest early on certain events. Single-trigger vests on one event, usually a change of control such as an acquisition. Double-trigger requires two events — typically an acquisition and the person being terminated without cause within a set window afterward. Double-trigger is more common because acquirers prefer founders to stay after closing.
How is equity vesting taxed in Canada?
Canadian tax treatment of founder shares, options, and vesting differs materially from the United States — there is no direct equivalent to a US 83(b) election, and the timing and character of any taxable benefit depend on the specific instrument and on the Income Tax Act. This tool does not calculate tax. Speak with a Canadian tax advisor and lawyer before you set up or sign a vesting arrangement.
Can a vesting schedule be changed after it starts?
Yes, but only by agreement of the parties and usually the board, and any change can carry legal and tax consequences. Vesting terms sit inside a share purchase agreement or option grant, so amending them mid-stream must be documented properly. That is a strong reason to get the terms right from the outset.