We’ve seen tremendous growth in the number of new startups in recent years, but the pool of VC funding is not keeping pace with this growth. This can put cash-starved startups at a disadvantage when it comes to negotiating company-favorable investment terms from VCs.
But regardless of how eager founders may be to secure the funds needed to scale quickly, they should think very carefully before agreeing to any of the following three funding terms, which could limit their economic upside and control in the company they built.
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