Bad dating stock option
The one-year cliff was created to protect companies against issuing stock to bad hires, which typically are not recognized at least until at least a few months into their tenure.Vesting should not be confused with time to exercise.They find it quite offensive that they are required to vest their stock when they accept venture capital.In their minds the question is: “Why should we have to earn our stock when we gave you the privilege of investing?
The reason executives are able to command the acceleration benefit because ironically they are the ones most likely to lose their job in an acquisition.
By accepting vesting on your shares, you have the moral high ground to insist on vesting of the people you hire, thereby protecting the company from a potentially bad hire.
Unvested shares can be put back into the pool and used to hire a replacement.
Unfortunately some founders look at vesting through the lens of their desire to lockup employees and minimize their personal dilution and fail to see the unattractive and unfair nature inherent in the packages they offer.
Some companies offer vesting acceleration to employees in the event of an acquisition.