Stock Options Vesting Visualizer
Project a monthly or quarterly stock-option vesting schedule with paper-gain math.
Overview
A stock-options vesting visualizer projects when an employee's grant becomes exercisable, the running paper value at any point in the schedule, and the total potential gain if the company's share price plays out as assumed. Equity compensation is now standard across tech, biotech, and many startup-funded companies; understanding the vesting cliff, the periodic vesting cadence, and the gap between strike price and fair market value (FMV) is the difference between negotiating a thoughtful offer and accepting a number that looks big but vests on a calendar that does not match the employee's plans.
A typical grant is structured as a four-year vest with a one-year cliff: 25% of shares vest on the first anniversary, and the remaining 75% vest monthly or quarterly over the next three years. Leaving before the cliff forfeits the entire grant. This tool models that schedule, computes the cumulative vested share count at any date, and applies a price assumption to show paper gains. It does not model taxes or exercise costs, which can be substantial for non-qualified stock options (NSOs) and require specialist advice.
How it works
Total grant G over N months with cliff C months and vesting frequency f (monthly or quarterly): at month t < C, vested shares = 0. At t = C, vested = G × (C / N). After the cliff, each vesting event adds G × (f / N). Paper gain at any date is (current_FMV − strike_price) × vested_shares. For ISOs versus NSOs the math diverges only at exercise: NSOs treat the spread as ordinary income; ISOs may qualify for long-term capital gains if held long enough after exercise and grant.
Examples
- 40,000-share grant, 4-year vest, 1-year cliff, monthly thereafter. After 12 months: 10,000 shares vested. After 24 months: 20,000. After 36 months: 30,000.
- The same grant with FMV growing from $1 (strike) to $5 over 4 years: paper value at month 24 ≈ 20,000 × ($3 − $1) = $40,000; at month 48 ≈ 40,000 × $4 = $160,000.
- Quarterly vesting instead of monthly: vesting in 1/16 chunks after the cliff. Cash-flow impact is small but matters for tax-year planning around exercises.
- Employee leaves at month 30 with 22,500 vested and 17,500 unvested forfeited.
FAQ
What's the difference between a grant and vesting?
The grant is the total shares promised; vesting is the schedule on which you earn the right to exercise them.
What is a cliff?
A waiting period (typically 1 year) before any shares vest. Leaving before the cliff means forfeiting the entire grant.
Are RSUs the same as options?
No. RSUs are shares that simply convert on vest; options give the right to buy shares at the strike price.
What happens to unvested shares if I leave?
They are forfeited unless your contract includes acceleration clauses (typical only for double-trigger events on acquisition).
Should I early-exercise options?
Sometimes, to start the long-term capital gains clock and minimise spread at vest — but it ties up cash and carries forfeiture risk. Speak with a tax advisor before deciding.