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The downside of high valuations

StartupCFO

When it comes to deal structuring, the higher you push the valuation, the more “protections&# investors will build in. These dividends usually convert into more shares at a fixed price. This means that if you issue shares later at a lower price than the shares you issued today (“down round&# ) the previous shares get repriced at somewhere between those two issue prices. 53% of deals had participating prefs.