Both Sides of the Table

JUNE 5, 2011

I raised my A round at a $31.5 million post-money valuation with no revenue. We had companies pitching us that had almost no revenue at all and they were raising $10-15 million in capital at a $40-50 million pre-money valuation. Another firm we saw tried to raise $15 million at a $60 million pre-money with similar metrics.

Pre-Money Valuation 336

Pre-Money Valuation Valuation Silicon Valley Stock 336

Both Sides of the Table

SEPTEMBER 18, 2014

Him: But when I raised my first round we didn’t know how to price the company. There were no metrics. How will you price the next round? Your A round? Him: On metrics. Revenue multiple? If we priced it based on any metrics your company would likely be worth less than 7 figures at your A round.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Both Sides of the Table

SEPTEMBER 27, 2010

They raised at $40 million pre-money for pre-revenue companies and when the economy corrected it became hard for them to refinance themselves. If either condition doesn’t hold it will be hard to do anything but a flat or down round. We saw this with VC backed companies in 07/08.

Silicon Valley 308

Silicon Valley Liquidity Event Seed Stage Finance 308

Gust

SEPTEMBER 17, 2014

Him: But when I raised my first round we didn’t know how to price the company. There were no metrics. How will you price the next round? Your A round? Him: On metrics. Revenue multiple? If we priced it based on any metrics your company would likely be worth less than 7 figures at your A round.

Liquidation Preference 153

Liquidation Preference Valuation Term Sheet Stock 153

abovethecrowd.com

APRIL 20, 2016

A high performing, high-growth SAAS company that may have been worth 10 or more times revenue was suddenly worth 4-7 times revenue. Also, they have a strong belief that any sign of weakness (such as a down round) will have a catastrophic impact on their culture, hiring process, and ability to retain employees.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

Reid Hoffman

JUNE 8, 2021

The burden [should] just be that we care; that if we learn something, we improve it, and that we don’t only use single output metrics and its growth at all costs. But now our hosts are really angry, and they have a huge revenue shortfall. And I made a decision not to do an equity round, because I thought it would be a down round.

Silicon Valley 69

Silicon Valley Hosting Rhode Island Design 69

Growthink Blog

MAY 23, 2011

This venture capital financing - usually between $3 and $10 million - is the first of a number of rounds of outside investment over a period of three to five years. With this capital, the company propels itself to $50 million+ in revenues, and to either a sale to a strategic acquirer or to an initial public offering.

Angel Investor 112

Angel Investor Venture Capital Sweat Equity Cram Down 112