> Also Sequoia wouldn't have got anywhere near 35%.

Bingo!

I don't think anyone would be interested in taking a round that would dilute us this much, especially when the need for money is not pressing.

The smaller the percentage, the higher the expected acquisition price. For a 10% ownership stake from a $40M investment, the acquisition would need to be $4B just to earn 10x their money back.

I was just wondering about some scenarios where Docker could achieve that kind of price.

You haven't taken in to consideration an important variable - how much of the 40M is invested by Sequoia vs. pro rata by existing investors.

Why does that matter, the other investors are hoping for returns too?

preferred vs common, participating preferred vs common (i.e. liquidation preference), possible pro-rata rights (thought at this stage further financings are probably unlikely)

disclaimer: I work at greylock, who was an earlier investor, though have _zero_ inside knowledge of the deal as I work on unrelated stuff.

I was talking specifically about the equation, not about the expected returns of investors.

This doesn't actually matter assuming the 40m bought 10%.