[mind-blight]

That's not true. Dilution is based on the number of shares, not the price.

Common vs preferred stock only matters in the event of same or liquidation if a company - preferred is paid out first. At IPO, both kinds of shares convert into the same public class of stock (with the rare exception of founders creating a special class of shares for increased voting power).

[svnt]

They do both typically convert to the same class at IPO, but preferred often has a conversion ratio — that is, it isn’t always 1:1, the way common is.

Functionally dilution should be considered in the full context of the financial outcome unless we are talking about voting rights and I wasn’t. For small shareholders the only real value of stock is money. If it is worth less money then its value has been diluted.