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Is it common for seed investors to want to be bought out by Series A investors? I've only read a little about the process, and was left with the impression that the inverse would be more common: seed investors really wanting to also invest in Series A to maintain their share (pro rata).

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It's highly, highly uncommon, which is why the "Ponzi scheme" label falls flat to anyone who is close to venture. Seed investors will typically not exit their positions until very late in the company's life, either in later growth rounds (C, D, etc.) or at IPO.

Not really. Just because they exit at a later stage doesn't mean its not a ponzi scheme. Chamath Palihapitiya certainly disagrees with you (https://youtu.be/RwRZtZQoLtQ). Skyhigh valuations with no product market fit and no path to revenue certainly sounds like one to me. Many startups burn money to acquire customers, but churn is high because they don't have PM fit. It becomes an endless cycle of raising to acquire more customers. Once the money stops, someone will eventually be holding the bag.

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