Both Sides of the Table
JULY 29, 2010
The A round was done in February 2000 (end of the bull market) and my B round was done in April 2001 (bear market). As a result I had to do a down round. Down rounds are psychologically really difficult on companies and can make it harder to do later rounds. I eventually needed more money.
VC Cafe
OCTOBER 31, 2022
Many companies are now having to resort to tough measures in order to stay afloat, including layoffs, down rounds and tough terms from current investors. If the answer is yes, then a down round is likely the best path forward. Why you shouldn’t worry about raising a down round ( source ).
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Both Sides of the Table
MAY 5, 2013
. “Whenever I hear advice about pricing a round too high for the next round, I can’t help but think: well, if the choice (ceteris paribus) is between. I would love it if other people would weigh in on the comments section below if you’ve had experiences with down rounds. A down round.
Steve Blank
NOVEMBER 2, 2009
In times when venture capital is hard to get, investors extract high costs for failure (down-rounds, cram downs , new management teams, shut down the company.) Marketing demand creation programs (Search Engine Marketing, Public Relations, Advertising, Lead Generation, Trade Shows, etc.)
Both Sides of the Table
JUNE 5, 2011
So in 2011 as a startup company if you can generate lots of demand you can definitely raise an A round of capital (say $3 million) at a $7 or 8 million pre-money valuation or slightly higher whereas just two years ago you would have struggled.
Startup Professionals Musings
NOVEMBER 25, 2020
With the advent and growth of crowdfunding over the past few years, many entrepreneurs have predicted the demise of those demanding angel investment groups and venture capital organizations. Your options for funding just increased, or at least you have a new way to get some real market feedback on the demand for your solution.
ReadWriteStart
JUNE 1, 2020
In very few specific cases, depending on the nature of the business, the business model might demand a considerable gestation period or extensive research and development. But, in subsequent rounds of funding inflated valuation will be normalized resulting in a down round. It might be tempting to do so.
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