I mean, yes, that's exactly the argument that the bigger, later investors make, and their lawyers are happy to back them up on that for money.

But consider this. If that were truly the case, why would the later investors work so hard to maneuver their way into this allegedly worthless startup? Why not hire an entirely separate team to build an entirely separate app, and they can own the whole thing with no fuss? If they value the founding team, why not tempt them away to a new venture, and shed all the baggage? Economics has an idea called "revealed preferences" - that words can be deceiving, but costly behaviors are honest - and this does look to be the revealed preferences of the investors.

In other words, just because the later investors can use the threat of insolvency to get their way doesn't mean what's already there doesn't have value.