Participation Rights
Participation Rights allow investors to retain their proportionate ownership in a company by participating in subsequent funding rounds.
Benefits
Participation rights protect investors from dilution, allowing them to maintain their ownership percentage.
Frequently Asked Questions
What are participation rights?
Participation rights allow investors to maintain their ownership percentage in future funding rounds.
What are pro rata rights for investors?
Pro rata rights allow investors to maintain their ownership percentage in future funding rounds.
What are preemptive rights vs pro rata rights?
Preemptive rights allow existing shareholders to buy new shares first; pro rata rights let them maintain their ownership percentage.
Key Takeaway
Participation Rights protect investors from dilution, maintaining ownership percentage.