Conversion, Pre-Money Valuation and Revenue

What Does the Post Crash VC Market Look Like?

Both Sides of the Table

SEPTEMBER 15, 2022

We drew this conclusion after a meeting we had with Morgan Stanley where they showed us historical 15 & 20 year valuation trends and we all discussed what we thought this meant. Should SaaS companies trade at a 24x Enterprise Value (EV) to Next Twelve Month (NTM) Revenue multiple as they did in November 2021? And we’re patient.

Technical Review

Technical Review Pre-Money Valuation San Francisco Valuation

Why Startups Should Raise Money at the Top End of Normal

Both Sides of the Table

JUNE 5, 2011

I wrote this because over the last decade I’ve seen a destructive cycle where otherwise interesting companies have been screwed by raising too much money at too high of prices and gotten caught in a trap when the markets correct and they got ahead of themselves. Again, prices are expressed as pre-money valuations.

Pre-Money Valuation

Pre-Money Valuation Valuation Silicon Valley Stock

The Changing Structure of the VC Industry

Both Sides of the Table

JULY 23, 2014

pre-money valuation you certainly would want to exercise your right to continue investing if you had prorata rights. Not only are they going public later when they are larger & stronger but the valuations upon their debuts are significantly more rational than the public dot com bubble.

Technical Review

Technical Review Venture Capital Valuation Pre-Money Valuation

How Much Should You Raise in Your VC Round? And What is a VC Looking at in Your Model?

Both Sides of the Table

MAY 28, 2018

There’s a quick litmus-test conversation any early-stage VC will have with the founder and it’s one that you should be as prepared for as your elevator pitch. It goes something like this … VC: “How much money are you raising?” One entrepreneur refrain I sometimes hear is “We want to raise some extra money for M&A activities.”

Burn Rate

Burn Rate Valuation Pre-Money Valuation Dilution

Cliff Notes S-1: Kayak ? AGILEVC

Agile VC

APRIL 17, 2011

How They Make Money: Majority of Kayak’s revenue actually comes from advertising on their site (55%), not lead generation or referral fees to travel suppliers as you might think (more on this below). Financial Snapshot: 2010 Revenue: $170 million. Revenue growth: 51% YoY (2010), 1% YoY (2009), 131% YoY (2008).

Pre-Money Valuation

Pre-Money Valuation Liquidation Preference Dividend Common Stock

Time is the Enemy of All Deals

Both Sides of the Table

FEBRUARY 25, 2010

million at a $15 million pre-money valuation. We had people hearing through the grapevine that we were about to raise money and new investors started calling us to get in on the deal. Conversely I offered the same deal to another entrepreneur who decided to shop around longer. Yes, this was stupid.

Technical Review

Technical Review Term Sheet Due Diligence Venture Capital

Strategy Roundtable: Try To Get At Least $2M Pre-Money In Seed Round Valuation

ReadWriteStart

OCTOBER 7, 2010

So at any point, if you are trying to raise money, and you are hearing from investors that you are too early and have too little validation, it may be a good thing. As a thumb rule, try to get enough validation so that you can get to at least a $2 million pre-money valuation before raising equity capital.

Valuation

Valuation Silicon Valley Pre-Money Valuation Bootstrapping

LinkedIn: The Series A Fundraising Story ? AGILEVC

Agile VC

MAY 26, 2011

Not long after the product launch we began the initial conversations with VCs for a Series A round. LinkedIn’s product had only been live for a couple months, we only had tens of thousands of registered users, and wouldn’t start generating revenue for more than a year after this point. It was a $4.7M

Term Sheet

Term Sheet Silicon Valley Technical Review Social Network

How to Fund Your Startup Without Losing Control

Up and Running

SEPTEMBER 19, 2017

That’s because obtaining a pre-money valuation for a concept level technology company in excess of $1 million is difficult, particularly for a startup founder without a proven track record. That is to say, they’d want to be able to control costs and revenues at a high level.

Private Equity

Private Equity Pre-Money Valuation Equity Startup

So What is The Right Level of Burn Rate for a Startup These Days?

Both Sides of the Table

FEBRUARY 15, 2016

The earlier the round, the less capital you need and the more reasonable your valuation the less time that is needed generally to raise capital. In other words, raising $2 million at a $6 million pre-money valuation has always been easier & quicker than raising $20 million at any valuation.

Burn Rate

Burn Rate Cap Table Valuation Software Review

Term-sheets and Valuations: Thinking about Negotiations - Startups.

Tim Keane

JANUARY 12, 2010

3] However, if they are built bottom up, they demonstrate and make explicit a range of business model assumptions the entrepreneur is using to think about his business and its revenue model. An average of these ranges results in a pre-money valuation of about $4MM. stake in the company. The Consideration of Risk.

Term Sheet

Term Sheet Valuation Dividend Liquidation Preference

Want to Raise Venture Capital More Easily? Clean Up Your Own Shite First

Both Sides of the Table

APRIL 14, 2010

It’s frustrating because you did $4 million in revenue last year and have a $7 million run rate for this year and you’re struggling to get financed for even $5 million while other startups are out there with no revenue raising $10 million at a $40 million pre money valuation! But pass they will.

Venture Capital

Venture Capital Liquidation Preference Common Stock Dividend

Cap Table Explained — What is it and How to Maintain it for Investors

Up and Running

SEPTEMBER 20, 2021

For instance, the cap table will help you with various possibilities while running business activities like available options and pre-money valuations faster. Here is an example of a cap table after a round of funding, with a pre-money valuation of $1 million. One of these terms is the valuation cap, ie.

Cap Table

Cap Table Pre-Money Valuation Stock Options Option Pool

Knowledge Is Power: Convertible Note Financing Terms, Part III

Gust

OCTOBER 12, 2011

In Part II, we looked at the mandatory conversion language that is at the heart of any convertible debt financing. Investors want to see the company hit a home run, achieve an exit at a hefty valuation, and ultimately generate a 10x or greater return on their capital. First, a word about the maturity date.

Finance

Finance Term Sheet Pre-Money Valuation Early Stage

Keep It Under Your Hat: Valuation Caps and the $650 Million Sale of MySpace for $125 Million

Gust

NOVEMBER 4, 2011

Entrepreneurs and investors who have spent any time dealing with convertible debt seed financing transactions are likely to have encountered the subject of valuation caps. was spun out, and the valuation was set by that financing round. These options were granted shortly after MySpace, Inc. Intermix and its advisors weren’t fools.

Valuation

Valuation Pre-Money Valuation Merger Vesting

StartUpRoar

What Does the Post Crash VC Market Look Like?

Why Startups Should Raise Money at the Top End of Normal

Trending Sources

The Changing Structure of the VC Industry

How Much Should You Raise in Your VC Round? And What is a VC Looking at in Your Model?

Cliff Notes S-1: Kayak ? AGILEVC

Time is the Enemy of All Deals

Strategy Roundtable: Try To Get At Least $2M Pre-Money In Seed Round Valuation

LinkedIn: The Series A Fundraising Story ? AGILEVC

How to Fund Your Startup Without Losing Control

So What is The Right Level of Burn Rate for a Startup These Days?

Term-sheets and Valuations: Thinking about Negotiations - Startups.

Want to Raise Venture Capital More Easily? Clean Up Your Own Shite First

Cap Table Explained — What is it and How to Maintain it for Investors

Knowledge Is Power: Convertible Note Financing Terms, Part III

Keep It Under Your Hat: Valuation Caps and the $650 Million Sale of MySpace for $125 Million

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