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Founder vesting

Also called: founder stock vesting

In one line

Vesting applied to founders' shares, so they earn their equity over time rather than owning it all outright from day one.

In plain English

Even founders usually vest their shares, protecting the company if a co-founder leaves early. Unvested founder shares can be repurchased by the company.

If you were explaining it to a 5-year-old

Even the kids who started the club have to keep helping to fully earn their toys — they don't get them all instantly either.

Why it matters when you sell

Founder vesting shapes the cap table's stability and how shares could revert if a founder departs — context for the company's ownership.

Related terms

Put it to use

How vesting works

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Sources

A general market-practice term. See how we define and source the glossary in our methodology. General information, not advice.

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