[seibelj]

Investors and founders hate down rounds. You want a pricing to be as beneficial as possible to all involved. Startups are extremely risky and getting a deal done at any price is an accomplishment.

Now you want to give a lot of small shareholders liquidity. The pricing is far more often. The whims of the world plus poorly negotiated deals can make a small sale be far below the last investment price. Psychologically this is bad even for wealthy investors and investing is heavily based on psychology.

No one wants to let that happen except the employees. The founders, the board, and the earlier investors don’t want anything that can jeopardize their argument for what their shares are worth.