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One of the major reasons some of the funding rounds are so big is that a large chunk of the money is going to buy equity directly from the founders rather than going into the company.

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Not on the seed or A round they aren't.

I've seen a couple of cases locally where founders took a bunch of money in the A round (specifically I'm thinking of Kik.) I guess I don't have much more than anecdotal evidence though.

Sorry, but no.

You have no idea what you are talking about. VCs wanted a larger % cut, team didn't want the dilution. Founders still drive the same crappy cars.

http://techcrunch.com/2011/03/29/ted-livingston-kik-velocity...

So the 7M raised was ok for dilution, but that last 1M was just too much to bare?

Just because it's in a press release doesn't make it true.

Expectations are a bitch. Once you set them, its hard to undo. I sold personal shares because my co-founders didn't want to be diluted by another 1%.

And Ted's a friend, the press release was for your benefit.

I had the opportunity to take money off the table on an A round. I was surprised as anyone.

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