What is Single-Trigger Acceleration?
Single-Trigger Acceleration
Single-Trigger Acceleration is an equity clause that accelerates vesting immediately upon a change of control (acquisition), regardless of whether the employee remains with the company.
Why It Matters for Startups
Governs the legal rights and ownership distribution of the entity; configuring Single-Trigger Acceleration is critical for managing long-term cap table health and alignment during early advisor agreements and key hiring incentive design.
Detailed Deep Dive
Single-Trigger Acceleration provides immediate equity liquidity upon acquisition. Because it can lead to talent departures, acquirers often push back on single-trigger clauses for key employees.
Frequently Asked Questions
Q:Why are investors wary of single-trigger acceleration?
It allows employees to exit immediately after an acquisition with fully vested equity, leaving the acquirer without key personnel.
Q:When is single-trigger acceleration acceptable?
It is sometimes granted to early advisors, board members, or consultants who are not critical to post-acquisition operations.
Quick Facts
- CategoryLegal
- Key ApplicationEarly advisor agreements and key hiring incentive design
Coverage Trend12 Weeks
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