This is exactly how each round of investment works. The board creates new shares for each round. Previous investors wanting to maintain their percentage ownership must invest again.

A new investor brings money into the business to "purchase" those newly printed shares, so diluting previous investors' percentage of ownership doesn't necessarily change their material position unless there are more strings attached to the investment.

For example, if an enterprise was worth $100M before investment and then there's a new investor that brings in $100M, the new investor owns 50% of a $200M pie and the previous investors combine to own 50% of $200M as opposed to 100% of $100M.

Also applies to employees' stock. Except companies generally don't re-up their employees's options with each round of dilution.

Nor should they, because it's the investor who is contributing something new, not the employee. Employees should get re-upped when they are close to fully vested.