Tag-Along Rights
The right of minority shareholders to join a sale initiated by a major shareholder, on the same terms.
Tag-along (or co-sale) rights protect minority shareholders — often founders or early employees selling personal shares — by letting other shareholders join that sale on the same price and terms, rather than being left behind while a large holder cashes out. They're most relevant in secondary sales, where a founder or major investor sells existing shares to a new buyer rather than the company issuing new stock.
In practice, tag-along rights are frequently paired with a right of first refusal: before a shareholder can sell to an outside buyer, the company and other investors typically get the first opportunity to buy those shares themselves, and only after declining does the tag-along right for outside buyers become relevant.
If you're a founder planning any personal secondary sale, check your tag-along and ROFR provisions early — investors can have real leverage to slow, block, or piggyback on that sale, and surprises here can derail a liquidity event you were counting on.
How is tag-along different from drag-along?
Tag-along protects minority holders by letting them join a sale someone else initiated; drag-along protects a majority by forcing minority holders to join a sale the majority approved — they solve opposite problems.
Related terms
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