The first conversation most senior candidates have about equity is about grant size. How many shares. What percentage of the company. What the 409A says the value is. These are all relevant questions, but they are not the most important ones. In our experience placing senior US professionals, the candidates who walk away with the most realized equity over a 4-year tenure are almost never the ones who negotiated the largest initial grant. They are the ones who negotiated the structure around it.
The variables that determine realized equity value — vesting schedule, refresh policy, acceleration on change of control, tax treatment, and the good-reason resignation clause — are routinely overlooked in senior offer negotiations, even by sophisticated candidates who negotiate well on base and bonus. This piece breaks down what each variable is worth and how to negotiate each one effectively.
The vesting schedule
The traditional US equity vesting schedule is 4-year with a 1-year cliff: zero vesting in the first year, 25% on the 1-year anniversary, and then monthly vesting at a rate of 1/48th of the total grant per month through year four. This structure was designed for a different era of employee tenure and a different pace of company development, and it is slowly being replaced.
Three alternative structures are now common enough in senior US offers to negotiate:
3-year vesting. Meta moved to 3-year RSU vesting for senior employees starting in 2024, and the trend is spreading. A 3-year vest on an equivalent dollar grant produces meaningfully higher annualized realized value because the same dollars vest over a shorter window. If you have the leverage, ask for 3-year vesting. The company’s cost is minimal in a scenario where you stay; your benefit if you need to leave is significant.
Front-loaded vesting. Some late-stage private companies now offer schedules like 33% in year one, 33% in year two, and 34% over years three and four. This structure is almost always better for the candidate than the traditional 4-year cliff, because it accelerates the realization of early vesting and reduces the leverage the company has to retain you in years three and four. Ask for it explicitly in the final-round negotiation.
Milestone-triggered vesting. Less common but worth knowing: some PE-backed and pre-IPO companies offer equity grants with a portion tied to specific performance milestones (revenue targets, product launches, EBITDA goals). If the milestones are clearly in your control and the plan is well-funded, milestone vesting can produce better outcomes than time-based vesting alone. Be skeptical of milestones that depend primarily on factors outside your control.
The refresh policy
The most underdiscussed variable in senior equity negotiation is the refresh grant policy. At public companies, annual refresh grants are standard and well-documented. At private companies, especially pre-Series-D companies, the refresh policy is often completely absent from the offer letter — meaning the candidate has no entitlement to anything beyond the initial grant.
Why this matters: over a 4-year tenure, cumulative refresh grants at most companies that have them typically add 50% to 100% to the value of the initial grant in annualized terms. A VP who joins with a $1.2 million initial equity grant and secures a guaranteed refresh of $350,000 per year starting in year two will realize, over a 4-year tenure, approximately $2.25 million in equity value — vs. $1.2 million without the refresh. That $1 million difference is the result of a single negotiation point that is almost never discussed.
Get the refresh policy in writing before accepting any offer. Specifically ask: Is there a guaranteed minimum annual refresh? Is it discretionary or formulaic? Is it tied to performance ratings? What is the dollar or percentage target? Companies that have strong refresh policies are usually willing to put them in writing; companies that are evasive about the question often don’t have one.
Acceleration clauses
Acceleration clauses determine what happens to unvested equity when the company is acquired or when you are terminated. There are two primary structures:
Single-trigger acceleration vests all or a portion of unvested equity on change of control alone, regardless of whether you stay or leave. This is the strongest candidate position and the rarest in practice, because it reduces the company’s leverage to retain you through an acquisition process. If you can negotiate it, take it.
Double-trigger acceleration vests unvested equity only if two events occur: change of control, AND termination without cause or resignation for good reason within a specified period (typically 12 to 24 months). This is the most common compromise. Push for the highest double-trigger percentage you can negotiate (100% is the candidate best case; 50% is a common starting floor) and the longest triggering window (18 to 24 months post-CoC).
The cost to the company of granting acceleration in any non-exit scenario is zero. The value to the candidate in an exit scenario can be several years of unvested equity. This is one of the highest-ROI negotiation points in any senior equity package.
Tax treatment and timing
Two tax scenarios that senior candidates routinely underweight when evaluating equity packages:
IPO lock-up exposure. If you join a pre-IPO company and the company goes public during your tenure, you will typically be subject to a 180-day lock-up period during which you cannot sell shares, even as they vest. In a rising-stock scenario, this is a manageable inconvenience. In a declining-stock scenario following IPO, the combination of vesting shares you can’t sell and ordinary income tax on the vesting event can create a significant tax liability on equity you haven’t been able to monetize. Ask the company explicitly what provisions exist for lock-up tax indemnification before accepting any pre-IPO offer with significant equity.
Early exercise and 83(b) elections. If your equity is granted as options rather than RSUs, an early exercise combined with a timely 83(b) election can convert what would otherwise be large ordinary income tax events at exercise into long-term capital gains events at sale. The mechanics are specific to option-based grants and require a tax advisor, but the savings can be material. If you are being granted options at a private company, ask your tax advisor about 83(b) elections on your first day employed, not after cliff vesting.
Final thoughts
The single most useful reframing for senior equity negotiation is to stop thinking about the initial grant as the equity package and start thinking about the entire 4-year equity program as the package. The initial grant is input; the refresh rates, vesting schedule, acceleration provisions, and tax treatment are the variables that determine output. The candidates who realize the most from their equity over a typical tenure are the ones who treated all of those variables as negotiating points rather than accepting the company’s defaults.
For specific data on what equity packages look like across company types and sectors, our salary guides for New York CFOs and Bay Area VP Engineers contain the most detailed publicly-available breakdowns of equity package structures at different company stages. For advice specific to your situation, reach out directly.
Early exercise and 83(b) elections
For senior professionals accepting options (rather than RSUs) at early-stage private companies, one of the most valuable and least-understood tools is the Section 83(b) election combined with early exercise. The mechanics: most option grants are not taxable at grant because the options have no fair market value until exercise. The taxable event is normally at exercise, when the spread between the exercise price and the fair market value is treated as ordinary income. For a well-appreciated company, this can create a substantial ordinary income tax event at a moment when the stock is illiquid.
An 83(b) election, filed within 30 days of exercise, allows the option holder who exercises early (before vesting) to elect to be taxed on the value at the time of early exercise rather than at the time of vesting. If the options are exercised immediately after grant at a low per-share price, the taxable ordinary income is minimal. Any subsequent appreciation at vesting or sale is taxed as long-term capital gain rather than ordinary income. At the highest US income brackets, the difference between ordinary income rates (37% federal) and long-term capital gains rates (20% federal) on a $1 million equity gain is approximately $170,000 in federal tax. The 83(b) election is a legitimate tax planning tool that costs nothing except the awareness to file the form within 30 days.
The early exercise and 83(b) path requires careful tax and legal advice specific to your situation, and it involves putting personal capital at risk on illiquid company stock. But for candidates with high conviction in early-stage companies who have the financial capacity to do early exercise, the tax savings make it worth understanding.
IPO-scenario equity planning
The IPO scenario is one of the highest-variance equity outcomes for senior professionals, and the planning required differs materially from the standard equity evaluation. When a company files its S-1, several changes happen simultaneously: the 409A valuation is typically revised upward significantly (since the IPO process reveals what investors are willing to pay), the tax treatment of vesting events in the pre-IPO period may change, and a 180-day lock-up period begins at the IPO date during which insiders cannot sell shares.
The practical risk: RSUs or options that vest during the lock-up period generate ordinary income tax at the time of vesting, based on the fair market value of the stock on the vesting date. If the stock price declines during the lock-up period from its IPO price, you may owe taxes on a value higher than what you’ll ultimately receive when you can sell. Ask any pre-IPO company explicitly: what is the company’s policy on sell-to-cover elections at IPO? Does the company offer any assistance with the tax liability created by lock-up vesting? Are there any net-settlement provisions that allow tax withholding without the employee having to bring outside cash?
For candidates joining companies that are within 12 to 24 months of a potential IPO, negotiating specifically for the post-IPO equity treatment — in writing, before joining — is worth the effort. The conversation may also reveal whether the company has genuinely thought through these mechanics or is operating on assumptions that will break under scrutiny.
The negotiation playbook in practice
The most effective equity negotiation we’ve facilitated in our 2025 placements followed a consistent structure: the candidate came to the conversation having already done the math on what the total 4-year equity program was worth under different scenarios (target refresh accepted, no refresh, stock flat, stock +50%, stock -30%), and presented the conversation as a joint exercise in understanding the realistic total compensation rather than as a one-sided negotiation demand.
This framing accomplishes two things. It positions the candidate as financially sophisticated, which employers generally value at senior levels. And it forces the hiring company to engage substantively with the equity program rather than deflecting with platitudes about "competitive packages." Companies that refuse to engage substantively with a well-prepared equity analysis are often hiding a weak equity program. Companies that engage willingly are usually the ones with strong programs to stand behind.