What is accelerated vesting?
Accelerated vesting is a contractual mechanism that speeds up the scheduled vesting of stock options or restricted shares when specified events occur — most commonly an acquisition or termination without cause. Acceleration protects employees from losing unvested equity value in events triggered by the company rather than their own choice.
Single-trigger vs. double-trigger acceleration
- Single-trigger: 100% vesting on a single event — typically a change of control (acquisition). Rare for non-founders because acquirers prefer to retain talent under the original schedule.
- Double-trigger: 100% vesting only if both events occur: (1) a change of control, AND (2) involuntary termination (without cause) within 12 months of the change of control. Standard for executive-level grants in Silicon Valley.
Partial vs. full acceleration
- Full acceleration: 100% of unvested equity vests on the trigger event.
- Partial acceleration: typically 12 or 24 months of additional vesting credit on the trigger, accelerating a portion but not all.
Who gets acceleration
- Founders: often have single-trigger acceleration on first transaction, double-trigger on subsequent rounds — heavily negotiated in early term sheets.
- Senior executives (C-suite): typically double-trigger acceleration negotiated in employment offer letters.
- Mid-level employees: usually no acceleration; equity follows the original schedule.
- Vested cash-out: some acquisitions cash out all unvested equity at the deal price, regardless of formal acceleration — a negotiation outcome rather than a contractual right.
Why acquirers push back on acceleration
Acquirers buy companies partly for the team. Full acceleration of all employees would mean the team could leave immediately after closing with full equity proceeds — destroying retention value. Acquirers typically negotiate:
- Replace accelerated equity with new retention grants at the acquirer.
- Tighten “termination without cause” definitions to limit double-trigger payouts.
- Push for vesting continuation rather than acceleration.
Do: negotiate double-trigger acceleration in senior hire offer letters; ensure the trigger language is precise — “good reason” and “cause” definitions matter.
Don’t: grant single-trigger acceleration broadly — it destroys post-acquisition retention value and acquirers will discount the company.
Single-trigger vs double-trigger in an acquisition
Acceleration clauses come in two forms that allocate risk very differently on a sale. Single-trigger acceleration vests some or all unvested equity the moment a change of control happens. Double-trigger acceleration — the market norm for founders and key employees — requires two events: the acquisition and a qualifying termination (or material role change) within a set window afterwards. Acquirers strongly prefer double-trigger because it keeps the team incentivised to stay through integration; founders accept it for the same reason, while still being protected if they are pushed out after the deal. The precise definitions — what counts as a change of control, what is “good reason” to leave, and how much accelerates — are heavily negotiated, because they decide whether equity that took years to earn survives the very event that is supposed to reward it.
Single-trigger vs double-trigger in an acquisition
Acceleration clauses come in two forms that allocate risk very differently on a sale. Single-trigger acceleration vests some or all unvested equity the moment a change of control happens. Double-trigger acceleration — the market norm for founders and key employees — requires two events: the acquisition and a qualifying termination (or material role change) within a set window afterwards. Acquirers strongly prefer double-trigger because it keeps the team incentivised to stay through integration; founders accept it for the same reason, while still being protected if they are pushed out after the deal. The precise definitions — what counts as a change of control, what is “good reason” to leave, and how much accelerates — are heavily negotiated, because they decide whether equity that took years to earn survives the very event that is supposed to reward it.