Pro rata rights give you the option—not the obligation—to invest in future rounds to maintain your ownership. A sensible follow‑on strategy:
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● Reserve capital (e.g., 1:1 initial/reserve is common for funds; angels can adapt based on capacity).
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● Concentrate reserves into companies that clear objective milestones (revenue, retention, gross margin, unit economics, quality of later‑stage lead, terms).

● Avoid “automatic” follow‑ons—compare each round’s terms and risk to alternatives in your pipeline.

Following on into true breakouts can meaningfully lift returns. But be mindful of opportunity cost: a tough insider round at a high price may not beat a new, more attractive seed.