L3VLUP

Pro Rata Rights

The right to invest in future rounds in proportion to an existing stake, so an investor can maintain their percentage as the company raises more money. For a seed fund it is the term that decides whether an early winner keeps compounding in the portfolio or is diluted out of it, and post-money SAFEs grant it only by a separate side letter.

How a startup is financed · 21 of 26Next: Down Round

Where Pro Rata Rights comes up

Keep reading

The venture capital hub

Related Venture Capital terms

How a startup is financed: keep going

Go further than reading

The written material is free. These are the ways to get it applied to your own work.

Browse the full glossary — 263 finance recruiting and technical terms, in plain English.