Vesting Acceleration

Vesting acceleration is the contractual mechanic that vests some or all of an equity holder's unvested shares upon defined trigger events. It applies to stock options, restricted stock, founders stock, and RSUs, with two primary structures: single-trigger (acceleration on a change of control alone) and double-trigger (acceleration only if the holder is also terminated without cause or resigns for good reason within a defined window). It is a critical equity-grant term that determines how much of an executive's or employee's equity actually pays out in an exit scenario.

The two main structural flavors:

• Single-trigger acceleration: unvested shares accelerate upon the change of control itself, regardless of subsequent employment. Typically vests 50% or 100% of unvested shares immediately at close. Investor-unfriendly because it transfers significant cost to the acquirer (who must either retain the vesting on remaining shares or grant new equity to retain talent) without ensuring the executive stays.
• Double-trigger acceleration: unvested shares accelerate only if both (a) a change of control occurs AND (b) the holder is terminated without cause or resigns for good reason within a defined window (typically 12-18 months) after the close. The two events together trigger acceleration; either alone does not. Investor-friendly because it requires the executive to either stay through the transition or be terminated by the acquirer; voluntary departure or termination for cause doesn't trigger acceleration.

Concrete example: founder has 1M shares of founders stock, currently 50% vested (500K vested, 500K unvested), with double-trigger acceleration on the full unvested portion.

• Change of control, founder stays: at close, 500K vested + 500K unvested = 1M shares total but 500K still subject to acquirer vesting. If founder stays through, they earn out fully. If founder voluntarily leaves, they keep 500K vested but lose the rest.
• Change of control + termination without cause within 12 months: at termination, the 500K unvested accelerates and vests immediately. Founder owns 1M shares fully vested.
• Change of control + termination for cause: acceleration doesn't trigger. Founder keeps only the 500K vested, loses the 500K unvested.

Standard structures by role and stage:

• Founders: double-trigger acceleration on 100% of unvested at change of control is the most common; some founders negotiate single-trigger 25-50% acceleration at change of control plus double-trigger on remainder.
• Executives (C-suite, VP-level): double-trigger acceleration on 50-100% of unvested is common, with the percentage often tied to seniority and negotiation leverage.
• Senior employees (Director, Principal): double-trigger acceleration on 25-50% of unvested is common.
• Regular employees: single-trigger or double-trigger acceleration is increasingly rare; many companies grant no acceleration at this level and rely on acquirer retention packages.
• Advisors: vary widely; some have no acceleration, some have 100% single-trigger.

Why acquirers care about acceleration structures: acquirers buying a company typically want to retain talent through a transition period. Single-trigger acceleration removes the retention lever (executives are fully vested at close and free to leave); double-trigger preserves it (executives are vested only if terminated by the acquirer or quit for good reason, creating an incentive to stay). Acquirers structure deals around the existing acceleration provisions; aggressive single-trigger acceleration can reduce the deal price the acquirer is willing to pay.

What founders get wrong: Accepting standard offer-letter acceleration provisions without specifically negotiating the trigger structure and percentages. Single-trigger vs double-trigger and 25% vs 100% acceleration make enormous differences at exit. The right discipline: at hiring for any senior role, treat acceleration as a real negotiation point. For founders' stock specifically, double-trigger 100% acceleration is standard and what founders should expect; for executives, 50-100% double-trigger; for senior employees, 25-50% double-trigger. Get specific language documented in the offer letter and equity agreement.

Related: Single Trigger Acceleration · Double Trigger Acceleration · Vesting · Founder Vesting · Acquisition

FAQ

What is vesting acceleration?
A contractual mechanic in equity grants that vests some or all of the holder's unvested shares upon defined trigger events (typically change of control). Single-trigger acceleration vests on the event alone; double-trigger requires the event plus subsequent termination.

What's the difference between single-trigger and double-trigger?
Single-trigger accelerates on the change of control alone. Double-trigger accelerates only if both (a) a change of control occurs AND (b) the holder is terminated without cause or resigns for good reason within a defined window (typically 12-18 months) after the close.

What's the standard acceleration for founders?
Double-trigger acceleration on 100% of unvested at change of control is the modern standard. Some founders also negotiate single-trigger 25-50% acceleration at change of control with double-trigger on the remainder. Specific terms vary by deal dynamics and negotiation leverage.