Definition
Anti-dilution provisions adjust the price per share of earlier investors when a company raises capital at a lower valuation (a 'down round'). Full ratchet is investor-friendly; weighted average is standard. GitDealFlow's signals can help VCs anticipate down rounds by detecting engineering momentum declines.
Frequently Asked Questions
What's the difference between full ratchet and weighted average?
Full ratchet: early investor's price adjusts to the new lower price, causing maximum dilution to other shareholders. Weighted average: adjusts based on the size of the new round, more founder-friendly.