[qazwsxedcyco]

Having been involved in a startup which offered participation certificates, I'll say this: Stay far, far away. Nope, even further than that.

Participation certificates are derivatives of an underlying, either a separate share class, or even worse, options on a separate share class. Startup equity is hard enough to value outright. Derivatives on customized terms in a market which is by definition highly illiquid? No thanks.

(It doesn't help when the terms of both shareholder agreement and participation certificate agreement are slanted in favour of the early employees/founders by so much that the participation certificates are worthless on close inspection, but that's a different rant.)