Distribution Waterfall
定义
The distribution waterfall is the order in which exit proceeds are paid: debt first, then liquidation preferences by seniority, then common shareholders, with participating preferred complicating the flow.
它在融资中如何出现
Founders model the waterfall before accepting terms: in modest exits, preferences determine whether common stock receives anything at all.
常见问题
Why can a $40M exit pay founders little?
If the company raised $35M with 1x preferences, investors take $35M first; the remaining $5M splits among common holders and options.
What makes a waterfall founder-friendly?
1x non-participating preferences, pari passu between series, and total capital raised kept proportional to realistic exit sizes.