Finance & Moneyadvanced
Full Ratchet
Definition
A strong anti-dilution term that resets an early investor share price to match a later, lower round price.
Why it matters
A full ratchet heavily protects investors in a down round but can badly dilute founders, so it is worth resisting.
Example
With a full ratchet, an investor who paid £1 a share gets repriced to 50p after a down round, gaining extra shares.
Related terms
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