Anti-dilution protection

Anti-dilution protection(s): seek to protect an investor’s ownership from dilution suffered in a down round. This results in all shareholders without anti-dilution protection (usually founders and employees) bearing the burden of dilution, rather than it being shared equally among all shareholders. In the UK, this protection is often achieved by either: (i) issuing more shares to investors or (ii) increasing the number of ordinary shares into which each preferred share held by an investor will convert following a down-round.