Draft a fair employee equity plan your team can understand in 10 minutes
Beginner
10 min
English
Generate a clear, structured equity proposal covering allocation, vesting, cliffs, and dilution so you can review it with a lawyer and share it with your team.
Steps
- Open ChatGPT or Claude in a new chat.
- Copy the prompt template below and paste it into the chat.
- Replace each {variable} in curly braces with your company's details (stage, headcount, pool size, vesting preference).
- Press send and read the full draft it produces.
- Ask one follow-up: 'Make the employee-facing summary one page, plain English, no jargon.'
- Copy the result into a Google Doc or Notion page.
- Book a 30-minute review with a startup lawyer to validate terms before sharing with staff.
Prompts to Use
You are a startup advisor who helps founders design employee equity plans. I am the founder of {company_name}, a {stage} company in {industry} with {headcount} employees. We want to create an employee equity plan. Our total option pool is {pool_percentage}% of fully diluted shares. We want a {vesting_years}-year vesting schedule with a {cliff_months}-month cliff. We are in {country} and need to consider local tax and legal norms at a high level.
Write a complete draft employee equity plan with these sections:
1. Purpose of the plan
2. Total option pool and how it is allocated across roles (founders, early employees, future hires, advisors)
3. Vesting schedule and cliff explanation in plain English
4. What happens on termination, voluntary departure, and acquisition
5. Exercise period and any early-exercise option
6. A one-page employee-facing summary that a non-finance person can understand
Constraints:
- Be specific and realistic, not generic.
- Flag anything that commonly needs a lawyer's review.
- Use simple language a new hire would understand.
- Output as structured text with clear headings.
Tools Used
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