So basically you made an agreement with one set of investors and then went back on your word because another, "better" set of investors wanted to put money in? Maybe it's just me, but this doesn't reflect that well on you.
The effectiveness of the relationship between investors and startups in SV is built on upon being upstanding and not being overly manipulative. Founder/Investor agreements that are born from the manipulation of unexperienced founders always should be EXPECTED to turn out badly.
There's a child-like expectation that once the deal is signed or agreement is made that it's over. It never is, that's just the beginning. If you're expecting that everything is finalized as soon as an agreement is made, regardless of the conditions, then you're simply bad at business and taking risks that you haven't yet realized.
(Of course this isn't true in Europe. They love taking contracts extremely literally, and their economies suffer enormously for it.)
The founders could always threaten not to work enthusiastically (or basically at all). Nothing the investors can do about that. So the investors are better off taking their money back.
There's a child-like expectation that once the deal is signed or agreement is made that it's over. It never is, that's just the beginning. If you're expecting that everything is finalized as soon as an agreement is made, regardless of the conditions, then you're simply bad at business and taking risks that you haven't yet realized.
(Of course this isn't true in Europe. They love taking contracts extremely literally, and their economies suffer enormously for it.)