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fundraising
Down Round
Funding round at a lower valuation than the previous round, signaling distress.
A Down Round occurs when a company raises funding at a lower valuation than its previous round. This typically happens when a company underperforms expectations and signals distress to the market. It often triggers anti-dilution protections.
Tips
- Avoid down rounds by managing expectations
- Extend runway to avoid raising in weakness
- Negotiate anti-dilution terms carefully
Related Terms
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