A cram-down round has no effect on founders' ownership as founders are normally protected against dilution.

Question

Quizplus · Accepted Answer

A cram-down round involves the issuance of new shares at a lower valuation, which can dilute the ownership of existing shareholders, including founders. While founders may have some protection against dilution in their shareholder agreements, a significant decrease in valuation can still impact their ownership percentage.

A Cram-Down Round Has No Effect on Founders' Ownership as Founders