Pay-to-Play
Definición
A pay-to-play provision penalizes investors who do not participate in a future financing, typically converting their preferred stock to common or stripping protections.
Cómo aparece en el fundraising
Pay-to-play appears in tough markets and recapitalizations to force insiders to keep supporting the company or lose their privileges.
Preguntas frecuentes
Is pay-to-play good or bad for founders?
Often good: it pressures investors to fund the company in hard times and cleans preference stacks of non-supporting holders.
When do pay-to-play terms appear?
Mostly in down rounds and restructurings, where new money demands that old money commit or step aside.
Términos relacionados
Pon este término en práctica
Las definiciones solo ganan negociaciones cuando estás en una. Encuentra los inversores que financian tu etapa y empieza la conversación.
Explora la base de datos de inversores