Look, the case is pretty simple:

You probably under-appreciate the value of diversification.

You probably have too little liquidity.

You may have just put all your remaining liquidity towards buying a house.

You may be unaware of the degree to which liquidity in the macroeconomy will be tighter going forward (which will make it harder for your startup to raise its next round).

Quick Finance 101: There are two types of assets: liquid and illiquid. Liquid assets, such as money, can easily move around and be used in transactions. Illiquid assets, like startup equity, are tied in complex structures that are hard to move around, making them hard to turn into cash when you need to. If everyone tries to turn their illiquid assets into cash at once, the price tends to drop way down.

The conventional wisdom that employees go down with the ship doesn’t have to be true.

Here’s the deal.

When a startup takes an investment, it’s making a trade: cash for equity. The other people in the trade — the angels, the VCs, the cross-over investors — have protections you (probably) do not.

First, they buy protection from you in the form of a liquidation preference, aka, they get paid back first if you sell or are acquired.

Then, they generally create additional protection through portfolio diversification.

Finally, they are much more able (and willing) to hedge their risk in public equity markets. In other words, they have positions which tend to make money when the value of your company goes down.

They know winter comes in cycles, and they invest in protection.

To be clear, investors aren’t doing this out of some sort of moral failing or malice. They are protecting their bottom line because that’s their job.

People give them money to play with, in exchange they have to be good stewards of capital.

Which is kind of like being Steward of Gondor, but you don’t get access to a Palantir.

Well, unless you, you know, invested in Palantir.