Down round
A down round is a funding round raised at a lower valuation than the company's previous round, meaning the company is worth less per share than it was before.
A down round happens when a company raises new capital at a valuation below its last round. It can result from a tougher fundraising market, slower-than-expected growth, or a previous round priced too aggressively. Down rounds typically dilute existing shareholders more heavily and can trigger anti-dilution protections for earlier investors.
While down rounds carry a stigma, many strong companies have raised them, especially during market corrections, and used the capital to keep building. The valuation change is a data point, not a verdict.
As a signal, a down round is worth flagging because it often coincides with strategic shifts, leadership changes, or renewed urgency that can be relevant to vendors, partners, and competitors.
Funding events carry the round and amount; valuation direction can be inferred when paired with a company's prior rounds in the funding-events history from GET /v1/funding-events.
Common questions
More on down round.
Why would a company accept a down round?
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