Practical Law Glossary Item 3-422-1256 (Approx. 2 pages)
Glossary
Down Round Investment
A venture capital or other minority investment in which a new investor values the company at a lower enterprise value than investors in previous investment rounds. A down round investment results in:
A new investor paying a lower price per share than previous investors.
The issuance of a greater number of shares to the new investor than would have been issued at the previous, higher valuation of the company.