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The Summer Solstice And Seed Stage Squeeze

Haystack

Back in 2017, Fred Wilson noted the strategic importance of the seed stage , writing: Seed is really hard. You lose influence as larger investors come into the cap table and start throwing their weight around. Making angel investments, raising small seed funds. You lose way more than you win.

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The Silliness Of Recapping Seed Rounds

Feld Thoughts

It usually happens in a later round, when the company is in fact worth much less than the liquidation preference overhang and insiders use a pay-to-play and a low valuation to reset the preferences and the cap table. It’s not pretty, but it happens. And the VC is a firm we have no interest in ever working with again.