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GP didn't talk about "repaying" anything. Taking 160M instead of 40M at the same valuation means giving up 4x the shares, and that's going to result in a bigger voice for those investors at the table in making decisions about the future path of the company.

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That depends on the share classes. Companies with high interest from investors can sometimes get them to accept shares with reduced voting rights.

What if they were offered $160mm and Tailscale countered with 4X the valuation, lowering the number of shares by 75%? Similarly, what if they wanted $40mm but the only deal on the table was $160mm due to ownership targets of funds that can actually write $40mm+ checks? It's hard to play these armchair games, even less so when the terms aren't known.

You're right that we don't know all the terms, but $160M raised is not small and it is very reasonable to worry about what level of control will be given up long term because of it.

409a valuations are made up by independent appraisals, but it’d be quite strange for an investor to agree a share is worth 4 times the appraised value.

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