Hello- does anyone have any insight on how vesting schedules typically work for LLCs giving interest to an advisor?

likesmart
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It's important to distinguish whether you're giving _interests_ or the equivalent of the right to purchase an interest (or equivalent economic flows) at a later time (akin to an option). You need to make sure your LLC agmt doesnt give voting rights to an advisor, etc.

And 2-3 years for vesting is a long time for an advisor if your company's "advice needs" change--I generally recommend shorter vesting more tied to engagement length to better align incentives and allow co to "dump" advisor if their work is not valuable.

83(b) elections depend on what they are purchasing when and may not be necessary depending on circumstance.

likehelpful

Same vesting schedule as an advisor for a C Corp

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I would typically suggest granting profits-only interests with a profits threshold and 2-3 years vesting with vesting on annual anniversary of grant. If you want to avoid partner tax treatment, grant the units in an affiliate with linked units. Don't forget 83(b) elections.

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Are you asking what the standard advisor vesting schedule is (2 years with a 3-6 month cliff) or how the mechanics of vesting work in the context of an LLC (🤷‍♂️; I assume CPA or tax counsel would need to be looped in to deal with the capital account; IDK, I’m a DE C Corp guy)?

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Agree with A1.

Just use the Founder Institute FAST template

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,....

.....?

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