Question: Why don't founders control valuation if it is exceeding what they believe to be the true value of their company?
Basically let's assume a company raised money on a $10B valuation, and needs money down the line for a variety of reasons. They will have to make sure that the future round is at $10B+ which may or may happen, especially if the company is not flying high at that time. And, if they can't raise at $10B+, they'll have to go for a down round which can look very bad.
- Their shares go farther if they buy another company with stock
- Helps recruiting and retention if their employees can sell their options on secondary markets