A vesting rule that requires someone to stay a minimum time before earning any equity. The standard cliff is one year. If someone leaves before the cliff, they get nothing.
Why it matters
The cliff protects your company from someone leaving early with unearned equity. Without it, a co-founder who quits after one month still owns shares. That creates dead equity that sits on your cap table indefinitely and makes everything harder.
How it works
The standard cliff is one year. During that year, no equity vests at all. On the one-year anniversary, 25% of the total grant vests at once. After that, the remaining 75% vests monthly over three years. If someone leaves before the cliff, they get nothing. This simple mechanism prevents dead equity from short-tenure contributors. For example, if you grant someone 10,000 shares with a one-year cliff, they own zero shares at month 11. At month 12, they suddenly own 2,500 shares, and then roughly 208 shares vest each month after that.
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