I'm not a lawyer, and you should ask your lawyer this. This is why experienced startup lawyers are valuable to startups. They know what is normal and what is no

I'm not a lawyer, and you should ask your lawyer this. This is why experienced startup lawyers are valuable to startups. They know what is normal and what is not, and can protect you. If you don't have a startup lawyer, you should get one ASAP. Email me (details in my profile) if you need a referral. Participating preferred happens in about 35% of deals, but generally this is not a good one for the entrepreneur. http://www.quora.com/How-common-are-participating-preferred-stocks-in-the-startup-VC-world http://www.quora.com/How-common-are-participating-preferred-... These terms are best avoided if you have other options.