Equity Refresh Grants Explained

What happens when your original stock options are fully vested? Many startup employees don't realize that their initial grant is often just the beginning. Equity refresh grants—also called "refresher grants"—are additional stock options granted later in your tenure to keep you incentivized and aligned with the company's success.

This guide explains what refresh grants are, when you might get one, and how to think about them in your compensation.

What Is a Refresh Grant?

A refresh grant is an additional stock option grant given to an employee after their initial hire grant. It's typically offered when:

• Your original grant is significantly vested
• You've been promoted to a more senior role
• The company has raised funding at a higher valuation
• You're being retained after a job offer from another company

Refresh grants serve two purposes: they keep your equity ownership from declining too dramatically as your initial grant vests, and they provide ongoing incentive for your continued contributions to the company.

When Do Refresh Grants Happen?

The most common timing for refresh grants is around the 3-4 year mark, when a significant portion of your original grant has vested. Here's a typical timeline:

• Year 1: Original grant starts vesting (typically 25% after 1-year cliff)
• Year 2-3: Continue vesting monthly
• Year 3-4: 75-100% of original grant vested; refresh grant often discussed
• Year 4+: If refresh granted, new vesting schedule begins

However, timing varies by company culture and your role. Some companies grant refreshers annually for top performers, while others wait until your original grant is nearly fully vested.

How Big Are Refresh Grants?

Refresh grants are typically smaller than your initial grant. A common rule of thumb is that refresh grants are 25-50% the size of your original grant. The exact amount depends on:

• Your performance level and impact
• Your seniority and role change (if promoted)
• The company's stage and funding history
• Retention risk (are you being recruited?)

Example: Original Grant vs. Refresh

Original grant (at hire): 10,000 options

Refresh grant (Year 3.5): 3,000-5,000 options

The refresh is smaller because your continued employment and career growth (promotions, raises) also provide value beyond equity.

Factors That Increase Your Refresh Grant

If you want a larger refresh grant, focus on these factors:

• Performance impact: Quantify your contributions—revenue generated, products shipped, teams led
• Retention leverage: External offers (even if you don't plan to leave) can signal your market value
• Timing: Asking when your original grant is 50-75% vested shows long-term thinking
• Company stage: Earlier-stage companies may be more generous with equity if cash is limited

Should You Negotiate Your Refresh Grant?

Yes. Refresh grants are negotiable, especially if you have a strong performance record or external offers. When negotiating:

• Come prepared with data on your impact
• Frame it as wanting to stay aligned with company success
• Be specific about the equity value (options × strike price)
• Consider total compensation (salary + bonus + equity)

What If You Never Get a Refresh Grant?

Not every company offers refresh grants, and not every employee receives one. If you're fully vested and haven't received a refresh:

• Ask directly—some companies only grant refreshers when requested
• Evaluate whether your total compensation remains competitive
• Consider external opportunities if your equity ownership is dwindling
• Factor in remaining run rate of the company (how close to exit?)

Key Takeaways

• Refresh grants are additional equity given after your initial grant is significantly vested
• Typical timing is 3-4 years in, when 50-100% of original grant has vested
• Refresh grants are usually 25-50% the size of your original grant
• Performance, retention risk, and promotions increase your chances
• Refresh grants are negotiable—come prepared with impact data