Yes, that is how &#x27;liquidation preferences&#x27; work.[1]  I strongly recommend reading&#x2F;watching Mark Suster, who (in my opinion) does a good job at explaining investors and terms.[2][3]<p>[1] <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Liquidation_preference" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Liquidation_preference</a><p>[2] <a href="http:&#x2F;&#x2F;ecorner.stanford.edu&#x2F;authorMaterialInfo.html?mid=2516" rel="nofollow">http:&#x2F;&#x2F;ecorner.stanford.edu&#x2F;authorMaterialInfo.html?mid=2516</a><p>[3] <a href="http:&#x2F;&#x2F;www.bothsidesofthetable.com&#x2F;" rel="nofollow">http:&#x2F;&#x2F;www.bothsidesofthetable.com&#x2F;</a>