Just thought I&#x27;d point out that the example given doesn&#x27;t tell us anything about liquidation preferences (though of course you can assume they would be involved, since we&#x27;re talking VCs here, but they don&#x27;t matter).<p>The relevant financing term here is anti-dilution. Here&#x27;s Feld: <a href="http:&#x2F;&#x2F;www.feld.com&#x2F;archives&#x2F;2005&#x2F;03&#x2F;term-sheet-anti-dilution.html" rel="nofollow">http:&#x2F;&#x2F;www.feld.com&#x2F;archives&#x2F;2005&#x2F;03&#x2F;term-sheet-anti-dilutio...</a>.