Venture Capital Marlee S. Myers Morgan, Lewis & Bockius, LLP Pittsburgh, PA 412 / 560-3345 msmyers@ morganlewis.com morganlewis.com		What is a cram-down venture financing? A cram-down venture financing happens when venture funders provide follow-on financing at a much lower valuation than earlier rounds. The result is that earlier investors and common shareholders (including employees) are diluted, often by substantial amounts. In today's venture market, with money tight and valuations low relative to valuations in 1999 and 2000, cram-downs are becoming increasingly common. Companies and early investors accept them as an alternative to running out of cash.

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