If you raise $40M -- and in most cases far less than that -- you most likely no longer control your board of directors. Most investors-turned-board-members will

If you raise $40M -- and in most cases far less than that -- you most likely no longer control your board of directors. Most investors-turned-board-members will have veto rights as well. Let's say you raise $40M and then a year later get a really great acquisition offer for $150M. That's most likely a veto. Your investor will want something more like $500M. The problem there is that there are fewer buyers at $500M than there are buyers at $150M. And no business is guaranteed; it could be that the next year goes slow or the market takes a dip, and it's impossible to even get a $200M offer. The founders have now been forced to pass on a "good" outcome because the investors wanted a "great" outcome. But great outcomes aren't available to everyone. Eventually the company spirals down, falls into obsolescence, cannot raise further funding, and is forced to firesale. The investors don't care because this loss is built into their model and they have another dozen companies on the same LP. The founders really care, because that's all they do. If all you need is $6M it's better to take $6M and keep as much control as you can, rather than take $40M and set yourself up for failure.