Anti-dilution
A protective provision for investors that adjusts their equity ownership percentage in the event of a future funding round at a lower valuation, ensuring their stake is not reduced unfairly. Anti-dilution provisions can come in various forms, such as full ratchet or weighted average adjustments.
This glossary provides an overview of some key legal terms for startups. It's essential to consult with a legal professional to ensure a comprehensive understanding of these terms and their implications for your specific situation.
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