Sign up to receive 5 free days of our daily summary for tech news.

Read this article for free.

Already a subscriber? Log in here

Venture Capital Markets

The Downside of IPO Veto Rights

Source: PitchBook. Graphic by Peter Schulz.

When joined the ranks of billion-dollar startups in November by raising money at a $1.62 billion valuation, CEO Marc Lore told the media that the deal terms were “clean”—implying that investors did not receive onerous protections that might hurt certain classes of shareholders later.

It’s true that the e-commerce company did not give investors the most punitive protections—guarantees of extra shares if the company goes public below a certain price. But investors did get the right to block any IPO from occurring if the offering price doesn’t return them at least 50% on their original investment, according to data from research firm PitchBook, which has partnered with The Information in tracking deal terms at private tech companies. That means a Jet IPO would need to be priced at a fully diluted valuation of $2.4 billion to avoid an investor veto.

What Is The Information?

Notebook b5103017ee163370a1667c9ce59ab0ef023875a17888105d26c185cadf31bb69

Daily news analysis

Every weeknight, we'll send you our reporters’ views on the day’s top tech news—distilled into one email.

Notes bb3aa5069205d702dda37fc71dc6f1c59df2310c4379304e9f1199f052af4884

Exclusive Articles

We broke it first. Receive original reporting, stories, and exclusives you won't read anywhere else from the largest newsroom in tech.

Conference calls c9e664e8b96ee347d3e92b8309938f268422b9db98cfabca5c826fbb75054b23

Conference calls

Go deep into areas like crypto and VC diversity—or get real-time analysis of breaking news—via conference calls with our reporters and other experts.

Events 499acedd16cffc41445edd76bfd302b2836c2a27419890f17130a6b10e2aa3df

Special Events

For no extra fee, subscribers get access to more than a dozen events yearly, from intimate dinners to larger gatherings with marquee speakers.

Access the best reporting on the tech industry read by tens of thousands of global executives.

Become a contributor

Share your views and find other subscribers by completing your profile. You’ll be listed in our contributor directory.

Org Charts

Access the only collection of tech company org charts. Our expanding database includes companies like Amazon, Snap, and Uber.

Slack community

Discuss topics and current events with our subscriber-only Slack group and share news about your company with other subscribers.

Share with your team

Subscribers can unlock any article and share it with friends and co-workers through a special share link.

Stay up to date on Silicon Valley

Sign up for Jessica Lessin’s (The Information’s CEO & Founder) free Saturday newsletter and also receive a complimentary week of our daily afternoon tech commentary email.

Already a subscriber? Log in here

Recent Articles

Asia Amazon E-commerce

Wish, an Internet Dollar Store, Struggles to Keep Customers

By Priya Anand


Market Rally Lifts 2018 Tech IPOs

By Alfred Lee

Cities Startups Uber/Lyft

After Fast Rollout, Scooters Hit Supply Bumps

By Cory Weinberg and Amir Efrati

Startups Markets

Tech Founders Cede Some Power to Shareholders

By Alfred Lee

Any time you put power in the hands of a minority investor to have (that kind of) leverage, that’s a terrifying state to be in,”