Safeguard your equity from hidden risks!
Reverse vesting is a mechanism used in startup equity agreements where founders or key employees receive shares upfront but must "earn" them over time by staying with the company.
If they leave early, the company or the remaining founders has the right to buy back the unvested shares at a nominal price.
Why Reverse Vesting is a game-changer for startups!
Encourages founders to stay invested in the company’s success.
Protects against a situation where inactive founders hold significant stakes.
Stops inactive founders from holding large stakes and blocking decisions.
Attracts investors by securing equity against premature exits.
Ensures that key employees contribute long-term before gaining full ownership.
Allows the company to reclaim and reallocate unvested shares efficiently.
Simplify reverse vesting with our hassle-free process!
Connect with Experts
Submit Required Documents
In-Depth Analysis & Structuring
Review and Finalize Agreement
Lock And Implement
Complete your reverse vesting process with the right paperwork!
Step-by-step guide to the Reverse Vesting process
Know what works best for you?
Feature | Reverse Vesting | Regular Vesting |
---|---|---|
Equity Distribution | Shares granted upfront but vest over time | Shares are granted over time |
Equity Distribution | Company can buy back unvested shares | Shares are granted over time |
Risk Protection | Company can buy back unvested shares | No buyback option for the company |
Control & Security | Safeguards company equity from premature exits | No such protection, equity remains with the individual |
Common Use Case | Founders & key executives | Employees & advisors |
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Your concerns matter: Explore our FAQs for guidance!
A reverse vesting order is a legal agreement that dictates how founders or key executives earn their shares over time.
While shares are issued upfront, the company retains the right to buy back unvested shares if the individual leaves before the reverse vesting schedule is complete.
Key clauses in a reverse vesting agreement include:
TA reverse vesting schedule ensures that founders remain committed to the startup while protecting investors from premature exits.
It prevents inactive founders from holding equity unfairly and helps maintain team stability.
Unlike traditional vesting, where shares are granted over time, reverse vesting provides shares upfront but requires founders to earn them back through continued involvement in the company.
If they leave early, unvested shares are reclaimed by the company.