Almost every startup begins the same way: a few founders, plenty of energy and a capital split agreed in an afternoon, usually in equal parts. The split reflects that day's commitment. The problem is that commitment changes and percentages do not. If a founder leaves after a year, they take a slice of a company that others will build, and those who stay end up working for them.
Vesting is the answer: each founder earns their stake through the time they put into the project, so whoever leaves early keeps only the part they have earned.
Why Spain does it differently
In the Anglo-American model, the founder receives shares that the company can buy back if they leave early, or receives shares gradually. In a Spanish limited company (SL), shares (participaciones) are subscribed and paid up on incorporation or on a capital increase, and there are no shares that earn themselves over time.
What is done instead is to give each founder all their shares from the start and agree that, if they leave before a certain date, the other shareholders (or the company) have the right to buy the shares not yet vested, at a price set in advance. Technically it is a conditional call option. In practice it has the same effect as American vesting.
The parts of the mechanism
A well-drafted vesting arrangement covers, at the very least:
- Total period. Four years is common, vesting monthly or quarterly.
- Cliff. An initial period, usually twelve months, during which nothing vests. Whoever leaves in month ten keeps nothing; whoever completes the year vests the corresponding portion at once.
- Good leaver. Departures not considered the founder's fault: death, incapacity, removal without cause by the others. They usually let the founder keep what has vested and sell the rest at market value.
- Bad leaver. Departures for serious breach, unfair competition or walking away early. They usually mean selling the unvested shares, and sometimes part of the vested ones, at a lower price, such as nominal value.
- Acceleration. What happens if the company is sold before the period ends. It is common to agree that all or part of what remains vests, so the founder does not lose their stake just as the value materialises.
Where to write it so it works
All of the above belongs, by nature, in the shareholders' agreement. But the agreement has a limit worth knowing: it binds those who sign it, not the company (article 29 of the Spanish Companies Act). If the departing founder refuses to sell, performance has to be claimed, and that can take time.
That is why good vesting arrangements also rely on the articles of association. One useful tool is ancillary obligations (article 86): each founder's obligation, set out in the articles, to work on the project. Wilful breach is a statutory ground for expelling the shareholder (article 350), which gives the company a route of its own, alongside the contractual one. It should not be overrated: if the shareholder holds 25 % or more of the capital and does not accept the expulsion, article 352 also requires a final court judgment, and expulsion means paying them the fair value of their shares. That is why the agreement remains the main piece.
The price needs care. A penalising exit price for a bad leaver is defensible, but a disproportionate one invites a court challenge. The clause has to be one you could explain to a judge.
When to do it
The best moment is on incorporation, when everyone trusts the project and each other. The second best is before the first funding round: professional investors commonly ask for it, and it is better designed between founders than imposed in a term sheet. We have written separately about what investors look at first: the numbers that decide a round.
For key employees, the equivalent tool is a share option plan. Spain's Startups Law (Law 28/2022) improved its tax treatment for emerging companies, among other things raising the annual exemption for shares delivered to employees from 12,000 to 50,000 euros, and it is worth designing it alongside the founders' vesting so the two do not clash.
What we need to design it
With the current capital split, what each founder brings (money, time, know-how) and a reasonable horizon for the first round, vesting can be designed and drafted in a few days.
If you would like to go through it with us, the initial consultation is thirty minutes, costs 60 euros plus VAT, and ends with a concrete proposal for your case.
This article contains general information for informative purposes and does not constitute legal advice or an investment recommendation. The rules cited may have been amended after publication; always check the text in force before taking a decision.