Should pro rata rights go only to the round lead or to all major shareholders?

Gili Raanan · Mar 18, 2024

A seed firm with strong industry relationships can reliably get the pro rata check size it wants even in rounds it doesn't price.

Lead investors in the industry are friends and respect the partnership, so taking pro rata is easy.

Scope: based on Cyberstarts' own experience; depends on having strong relationships with lead investors

48:22 20VC: 19 Company Portfolio: 1 Decacorn, 7 Unicorns, 4 Acquisitions; One of the Best Seed Investors of All Time on How to Pick Generational Defining Founders, Why Nothing but the Founder Matters & Why the Best Investors are Never Happy w/ Gili Raanan

Delian Asparouhov · Jul 29, 2024

No investor is entitled to their pro rata

Having been on the founder side of the table, investor entitlement can rub you the wrong way

37:39 20VC: Twitter's Most Controversial VC Delian Asparouhov on Inside the Walls of Founders Fund: What the World Does Not See | Why Western Europe Will Be Like the Third World | Why SaaS as an Industry Might Be Dead

Harry Stebbings · Oct 22, 2025

Pro rata should not be an automatic right — it should be earned

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Harry Stebbings · Nov 21, 2025

Pro rata is not a real legal right but a moral obligation an investor earns by stepping up

No one should have a right to future rounds by contract; you earn the right to write another check

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David Frankel · Aug 8, 2026 · hedged

Rounds that grant pro rata only to the lead rather than all major shareholders are the wrong approach; investors should be treated uniformly

There should be a universal approach that treats your investors equally, otherwise it creates unfairness and negative correlation bias

29:17 Treat all major investors uniformly on pro rata

Max Altman · Nov 21, 2025

Seed funds should model pro rata at only 70-80% of their entitlement, because when a top firm leads the next round you rarely get your full allocation

In great deals led by firms like Sequoia or Kleiner, allocation gets cut, and investors should be honest with themselves about that

45:03 Model pro rata at a discount because leads cut allocation