Funding Round A: VC “A” invests 200M (100M immediately and another 100M if sales grow 10% or whatever)
At 6 months the company will either get the other 100M automatically (meaning they grew sales 10%) or they don’t (meaning they grew less than 10%).
Assuming it’s the later they can then do another round during which they try to get the other 100M. In all likelihood VC “A” won’t be interested (or interested at a lesser amount). They could go ask VC “B” for an investment but it will likely be less than 100M as well because they didn’t grow as much as “the market” anticipated.
Nothing complicated at all.
I’ll give you $1 dollar for your banana today and another dollar in a week when it has ripened. If it’s rotten when I come to get my banana I won’t give you the other dollar. You have your original $1 and you can still try to sell your rotten banana to another HN reader but you probably won’t get another dollar this time.If instead you have a ripe banana I’m sure you could easily find a buyer.