Giving the previous investors an option to be in/out doesn't get anything for the founder.
If they 'want in' well, then they 'want in' and presumably, they'd 'want in' with or without the pro-rata.
What this means is that their position is guaranteed. If they 'wanted in' without the pro-rate, then the founder has more leverage.
Imagine you were trading options. Someone giving away options for free doesn't gain anything. The receiver of the options gains some material value, just in the option even if the strike price was the same as the current value i.e. options even.
You'd never just arbitrarily give away options on your company.
Now - there might be something to be gained in the relationship. It might just work out better with a fund, etc. to have that on the table.
But technically, no.
What would be interesting here is for someone to chime in on what the value of that option would be were it to be sold on the free market because we have methods for calculating those things.
It's something the investor wants to protect their investment. Compare e.g. getting warranties from the seller of a house - you could frame that as an option that you're getting for free and the seller should charge you for, but really without it you wouldn't want to make a deal at all.
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That's not a positive.
Giving the previous investors an option to be in/out doesn't get anything for the founder.
If they 'want in' well, then they 'want in' and presumably, they'd 'want in' with or without the pro-rata.
What this means is that their position is guaranteed. If they 'wanted in' without the pro-rate, then the founder has more leverage.
Imagine you were trading options. Someone giving away options for free doesn't gain anything. The receiver of the options gains some material value, just in the option even if the strike price was the same as the current value i.e. options even.
You'd never just arbitrarily give away options on your company.
Now - there might be something to be gained in the relationship. It might just work out better with a fund, etc. to have that on the table.
But technically, no.
What would be interesting here is for someone to chime in on what the value of that option would be were it to be sold on the free market because we have methods for calculating those things.
It's something the investor wants to protect their investment. Compare e.g. getting warranties from the seller of a house - you could frame that as an option that you're getting for free and the seller should charge you for, but really without it you wouldn't want to make a deal at all.