"Max, a great point. The bottom line is getting the right amount of capital to grow the business with incentives for the entrepreneurs that make sense. This can be done in the context of a down round, especially when earlier valuations got ahead of themselves. If incumbent management can't see the forest for the trees and shun fresh capital from good investors because it is "a down round," then that is a bad sign in and of itself. And good investors won't jam management such that their ownership stake becomes insignificant; that would be insanely short-sighted. In short, deals need be judged on their individual merits. Whether a round is down or not does not indicate good or bad. The issue is much more textured than that." - Roger