What is a liquidation preference?

Something minor, that nothing much matters.

Sorry, but let me step back.  So much bad web-thinking here.

Promising investors that take a huge risk on you, that if you are acquired, they’ll make 1x their investment … or that if you go under, there is some chance, maybe they’ll make 1x their investment … barely matters.

You really don’t want to return 1x to your investors??

Now, in the Old Days, this sort of stuff was often “worse” in that investors also got more than 1x in many scenario and more than the price per share common got under “participating preferred.”

But everyone seems to be making too much of a 1x liquidation preference.

It’s LIFO.

If you are going for it, it doesn’t matter at all.