What describes a timeline for earning equity over time?

The correct answer is the vesting schedule, which refers to the process by which an individual earns their equity or shares in a company over a specified period of time. This practice is commonly utilized in startups and tech companies to incentivize employees, encouraging them to remain with the company for a certain duration before fully owning their equity.

A vesting schedule typically outlines specific milestones or time frames—often in years—during which the employee gradually earns their shares. For instance, an employee might be awarded a certain number of shares that will vest at regular intervals, such as monthly or annually, over four years. This structure not only aligns the interests of employees with those of the company but also mitigates the risk of employees leaving with their full equity soon after joining.

While options like grant period, equity curve, and ownership timeline may refer to concepts related to equity and ownership, they do not specifically capture the model of earning equity over time as clearly and accurately as a vesting schedule does. Grant period generally refers to the time during which options are granted rather than earned, equity curve might imply a graph representing the growth of equity value, and ownership timeline indicates the duration but lacks the specific mechanism of how equity is accrued.