I'm not sure what PG's intention was, but I bet that "under-the-table dilution" in the form of liquidation preferences, board seats, and veto rights on sales be

I'm not sure what PG's intention was, but I bet that "under-the-table dilution" in the form of liquidation preferences, board seats, and veto rights on sales below Y% return is much more common in down rounds. These investor privileges often drastically change a founder's control of the company, and their payoff vs valuation curve, even for a nominal valuation that is "at par" for the founder's nominal equity value.