Startup Investing

Participating Preferred

Definition

What is Participating Preferred?

Preferred shares that receive a liquidation preference and then also participate in remaining proceeds.

Example in practice

The investor takes back 1x capital and still shares the balance.

Keep learning

A preliminary document outlining the main commercial terms of a proposed investment.

A company's agreed value immediately before a new investment.

A company's value immediately after adding new investment capital.

The rate at which a company spends cash, commonly measured monthly.

Think you know your investing terms?

Put your knowledge to the test with a quick quiz.