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> Also Sequoia wouldn't have got anywhere near 35%.

Bingo!

I don't think anyone would be interested in taking a round that would dilute us this much, especially when the need for money is not pressing.

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The smaller the percentage, the higher the expected acquisition price. For a 10% ownership stake from a $40M investment, the acquisition would need to be $4B just to earn 10x their money back.

I was just wondering about some scenarios where Docker could achieve that kind of price.

You haven't taken in to consideration an important variable - how much of the 40M is invested by Sequoia vs. pro rata by existing investors.

Why does that matter, the other investors are hoping for returns too?

I was talking specifically about the equation, not about the expected returns of investors.

preferred vs common, participating preferred vs common (i.e. liquidation preference), possible pro-rata rights (thought at this stage further financings are probably unlikely)

disclaimer: I work at greylock, who was an earlier investor, though have _zero_ inside knowledge of the deal as I work on unrelated stuff.

This doesn't actually matter assuming the 40m bought 10%.

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