Control & governance

Board seat

Board director · Investor director

A place on the company's board of directors, carrying a vote on major decisions and legal duties owed to the company rather than to the investor who appointed you.

Board observer

The right to attend board meetings and receive board materials without a vote, a fiduciary duty, or the personal liability that comes with a directorship.

Protective provisions

Investor consent rights · Reserved matters · Veto rights

A list of company actions that cannot be taken without the consent of a specified majority of preferred shareholders — regardless of what the board or the founders want.

Founder vesting

Reverse vesting · Founder restricted stock

An arrangement under which founders earn their own shares over time — typically four years with a one-year cliff — so that a founder who leaves early forfeits the unearned portion.

Employee option pool

ESOP · Share option scheme

Shares reserved for issue to employees as options, giving them the right to buy at a fixed strike price and share in the company's growth.