Equity Without Confusion (Part 1) Vesting ≠ Ownership Founders love telling employees, “You’ll own X% of the company after four years.” Sounds great. Until someone quits in year two and still claims “their” shares. That’s where most ESOPs collapse, on misunderstanding what vesting really means. Vesting is a right to earn ownership over time, not ownership itself. It’s a timer, not a title deed. Ownership happens only after the shares are actually granted, issued, and complied with board and ROC formalities. Till then, it’s a promise waiting to become paper. Most startups stop at the promise. Then spend months in disputes, audits, or employee exits wondering where it went wrong. If your ESOP policy doesn’t draw a clear line between vesting and ownership, you’re sitting on a time bomb. Because loyalty can’t survive confusion, and confusion begins with one careless clause. ------------------------------------------------------- This is Part 1 of my “Equity Without Confusion” series — decoding ESOPs that actually work. #startuplaw #ESOPs #corporatelaw #founders #legalstrategy #businesslaw