Pascal's View
JULY 9, 2017
This is a fundamental issue that does, indeed, boil down to understanding the post-money valuation of a company. At its core, this issue points to the lack of understanding about the importance of post-money valuation by both entrepreneurs and investors.
Lightspeed Venture Partners
SEPTEMBER 21, 2013
to fund the company at a $6M post money valuation from a number of investors including Selena Gomez. Despite having over 500k downloads and making $450k in revenue over the last 21 months, he had only $185k left in the bank, which meant that he would be out of business in 90 days if he didn’t raise more money.
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Feld Thoughts
JULY 14, 2015
A company raises $1m of seed money from angels in a convertible note with a $6m cap. Assuming equity is raised at or above that cap, the total dilution, before the new money, is 16.6% (equivalent to an equity financing of $1m at a $6m post money valuation. So they recapitalize the company.
Rob Go
MAY 20, 2014
I find that it’s also pretty typical for an existing VC investor to be willing to syndicate the deal with another outside investor. This enables the large VC to have another deep pocket around the table post Series A to be able to add capital into the company with less friction in both a good and bad scenario.
www.paulgraham.com
APRIL 28, 2010
Mechanics Angel investors often syndicate deals, which means they join togetherto invest on the same terms. In a syndicate there is usually a"lead" investor who negotiates the terms with the startup. Dont feel like you have to join a syndicate, though. The valuation determines how much stock you get. million, and youget.05/1.05,
Agile VC
APRIL 17, 2011
Post-money valuation probably no higher than $12M (2). Coordinates Recent Posts The Rise & Fall of Great Venture Firms [Part 1] 11 July 2012, 1:57 pm Our Investment in Cloze 25 June 2012, 5:36 pm Mobile Payments: The Trillion Dollar Industry That’s Never Happened 12 June 2012, 4:19 pm. round closed in June 2004.
Both Sides of the Table
AUGUST 1, 2010
Like Brad Feld I’m syndication agnostic but I have a slight preference toward working with others. If we come to an agreement and fund the HUGE benefit to entrepreneurs is that they don’t have to trek up and down Sand Hill Road looking for money. This is the nature of compromise.
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