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Why would you want later stage investors to drop out? You have early, cheap equity; don't later stage investors reset the valuation and give you a shot at cash
by calambrac 18y ago
Why would you want later stage investors to drop out? You have early, cheap equity; don't later stage investors reset the valuation and give you a shot at cashing out if you want? (I really don't know, I'm actually asking).
- pg 18y agoThe valuation goes up between us and a series A round, but in a successful startup it should go up much more afterward.
- calambrac 18y agoHow many companies that get a series A round end up being successful? It seems like having that opportunity to decide if you agree that the company will keep growing or that you've made enough and would rather reinvest in the next round of startups would be nice to have.
- pg 18y agoIt wouldn't be nice to the startups to do that, because it would send an alarming signal to the series A investors that would drive down the valuation and maybe even prevent the round from closing.