Preferred shares
Also: Preference shares
The share class investors usually take, with extra rights over ordinary shares — preferences, votes, protections.
The gap between preferred and common rights is where a lot of the real negotiation in a deal happens.
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Common shares
The plain shares founders and employees hold, last in line behind preferred in a payout.
Liquidation preference
The rule that decides who gets paid first, and how much, when the company is sold.
Anti-dilution
A clause that adjusts an investor's shares if you later raise at a lower price, protecting them in a down round.
Board seat / observer
A right to a seat (and vote) on your board, or to observe without voting.
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