An equity financing in which the company and investors agree on a per-share price and issue preferred stock, as opposed to a convertible note or SAFE.

Definition

A priced round is an equity financing in which the parties negotiate a fixed pre-money valuation, divide it by the fully diluted share count to derive a per-share price, and issue a new series of preferred stock at that price. This contrasts with convertible instruments (convertible notes, SAFEs) that defer valuation to a later priced round. Priced rounds typically involve a term sheet, a stock purchase agreement, an investors' rights agreement, a voting agreement, and a right of first refusal and co-sale agreement, largely following the NVCA model document set. For a MedTech company, a priced round often follows the accumulation of enough clinical, regulatory, or reimbursement evidence (a completed pivotal study, a 510(k) clearance, or an initial CPT code) to support a defensible valuation, whereas earlier bridge financing before those inflection points is frequently done on convertible notes or SAFEs to avoid pricing the company prematurely.

Why it matters

MedTech financing timelines are long relative to software, so companies frequently raise several convertible bridges between priced rounds to fund milestone-based work (a first-in-human study, a pivotal trial, an FDA submission) without repeatedly resetting valuation. The Series A priced round is often the first true price-setting event, and its terms (liquidation preference, anti-dilution, board seats, protective provisions) set precedent for every subsequent series.

Common pitfalls

•Assuming pre-money valuation is fixed before knowing the fully diluted share count; option pool top-ups negotiated 'inside' the pre-money valuation dilute founders more than the headline number suggests.
•Treating a priced round's valuation as directly comparable to a prior convertible note's valuation cap without adjusting for the option pool shuffle and any accrued but unconverted notes.
•Failing to update the cap table for outstanding convertible instruments before calculating price per share, which produces an incorrect post-closing ownership picture for all parties.

Sources

SEC Investor.gov: Venture Capital · SEC Investor.gov
NVCA Model Legal Documents · NVCA
Cornell LII: Preferred Stock · Cornell Law LII

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Regulatory pathway choice - 510(k) vs PMA, 510(k) vs De Novo, Abbreviated vs Special 510(k).
Quality systems - QSR vs ISO 13485, QMSR vs QSR.
Software classification - SaMD vs SiMD, Locked vs adaptive AI.
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