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I'm wondering about the 10% who didn't take the money and if there is adverse selection at play here.



Here is one possibility.

Suppose that you're planning to bootstrap. Then there will be no future round where you get the loan magically paid off, and this becomes just a loan with a not very great interest rate.


IIRC, there are a handful of companies in the program now that were already funded prior to being admitted. For a company like that, a 150k convertible note might not make much sense.




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