Cliff Period
The initial stretch of a vesting schedule — usually the first year — during which no equity vests at all, no matter how much time has passed.
Quick Answer
Is a cliff period required by law, or is it just a common practice?
It's a market convention, not a legal requirement — a company can technically vest equity from day one with no cliff, though most investors and boards expect the standard 1-year cliff on a 4-year schedule.
- No law mandates a cliff; it's negotiated convention
- Deviating from the standard can draw investor questions later
- Document any non-standard cliff explicitly in the grant agreement
The Lovie Advantage
Lovie applies your company's chosen cliff consistently across every grant, flagging any exception instead of leaving it implicit.
See how this connects to Double-Trigger Acceleration. For the formal definition, see Investor.gov's glossary entry on diversification.
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