Equity Refresh

An additional equity grant given to existing employees — typically after the initial grant has substantially vested — to maintain retention incentives.

An equity refresh is a new grant of stock options or RSUs given to an employee who is already past their initial grant's cliff, usually after two to three years of tenure. As the original grant vests out, the unvested portion — the 'golden handcuffs' component — shrinks. Refresh grants restore that retention incentive and recognize ongoing contribution without requiring the employee to leave and return to capture a fresh grant.

Refresh grants are increasingly standard at public technology companies and well-funded startups. The cadence, size, and trigger vary: some companies do annual refreshes for all employees above a certain level, others give refreshes only to high performers or following a promotion, and others require an employee to ask for one proactively.

The size of refresh grants matters enormously and is frequently a source of frustration among tenured employees. Initial equity grants are sized to be competitive in recruiting — they reflect market rates for a new hire at that level. Refresh grants are often smaller in absolute terms and are not always benchmarked against current market rates. An employee who joined at a senior level five years ago may receive a refresh grant that is 25–50% of their original package, despite having grown significantly in scope and impact. If equity is meaningful in your compensation thesis, ask your manager what the standard refresh cadence and sizing looks like before assuming it will match your initial grant.

Equity refresh grants appear to be a retention tool but often fail to deliver their intended effect. The unvested value at any given time depends on both grant size and current stock price. In a down market, refresh grants awarded at a depressed price feel meaningless to employees who joined when the price was higher and watched their unvested value decline. Conversely, when a stock has risen significantly since an employee joined, a refresh at current price levels gives them less ownership percentage for the same dollar face value. The true retention power of a refresh grant is deeply sensitive to market conditions that neither the company nor the employee controls.