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Presumably the "terms" in "set your terms very favorably for yourself" refers to valuation.

Seems like the premise here is that VCs will actually take that valuation into account during the round A. How common is that? (versus VCs trying to set the valuation regardless of valuation of the round done without them)

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Actually, no; the valuation is the one thing definitely renegotiated every round. (Prior numbers are only psychologically important to the insiders; there's no expectation later investors need to respect them.)

Instead, the terms referred to are all the other things that make stock 'preferred', and having an existing set of preferred stockholders makes it a little harder for later VCs to introduce new and different preferences. (And if they do, they may need to cut in the prior preferreds.) The transcript has more details.

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