Vesting schedule

Definition

The dates over which a granted stake is actually earned by staying.

Why It Matters

A searcher's equity almost never arrives at closing. It is earned across years and often across performance gates, and the schedule is where a backer's headline percentage becomes what a searcher will really hold. It governs a key manager's grant the same way. Ask for it in writing before a term sheet is signed, because the difference between a four-year and a seven-year schedule on the same headline number is most of the outcome. Firms very rarely publish this, so it has to be asked for.

In numbers: A 25% stake vesting in equal quarters over four years is 6.25% earned for each year of staying.