Gust

OCTOBER 18, 2011

Detailed descriptions will be published over the next few weeks: The Scorecard Method: This method compares the target company to typical angel-funded startup ventures and adjusts the average valuation of recently funded companies in the region to establish a pre-money valuation of the target. The Venture Capital Method.

Valuation 174

Valuation Pre-Money Valuation Southern California Post-Money Valuation 174

SoCal CTO

SEPTEMBER 27, 2011

I've talked about this topic before in How Investors Think About Valuation of Pre-Revenue Startups. You can also take a look at StartupRoar 's topics: Startup Valuation , Pre-Money Valuation , and Early Stage Valuation. Same Value for Sweat Equity as Investment Dollars?

Early Stage 391

Early Stage Equity CTO Hire Sweat Equity 391

YoungUpstarts

OCTOBER 24, 2013

“The reality is that there has not been a reliable, simple, or cost-effective way to calculate an early stage company’s valuation – which is why so many entrepreneurs and angel investors get it wrong,” says Alan Lobock, co-founder of Worthworm. ” Ideaspotting investment pre-money valuation valuation Worthworm'

Pre-Money Valuation 150

Pre-Money Valuation Web Technical Review Angel Investor 150

Both Sides of the Table

AUGUST 23, 2010

At an $86 million, pre-money valuation Benchmark sure did pay up for this investment. when people read the topic (although there’s still time for you to go there and vote up my answer ) Obviously kidding. No, really. Still, I’m betting they got this one right.

Silicon Valley 301

Silicon Valley Pre-Money Valuation Technical Review Software Review 301

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. Just 3 years ago there was talk of institutional investors “not being able to write small enough checks.” ” Stated simply – if you seed funded Uber at $4.5m

Technical Review 398

Technical Review Venture Capital Valuation Pre-Money Valuation 398

Gust

NOVEMBER 15, 2011

The Risk Factor Summation Method the fifth methodology for estimating the pre-money valuation of pre-revenue companies we have described in recent posts. For more information on determining the average valuations in your area, see the Scorecard Method. million pre-money valuation. million.

Valuation 102

Valuation Pre-Money Valuation Ohio Early Stage 102

Both Sides of the Table

APRIL 20, 2011

Twitter wanted to raise money for this new venture at a pre-money valuation which was quite a bit higher than First Round’s $10 million limit. First Round Capital’s pre-money range is usually between $3-5 million. Odeo returned investment funds back to their investors when they decided to create Twitter.

Pre-Money Valuation 284

Pre-Money Valuation Technical Review Cofounder Cram Down 284

Agile VC

APRIL 17, 2011

Pre-money valuation was initially set higher but was adjusted to match the Ser B valuation. Pre-money valuation was approx. Pre-money valuation was approx. Pre-money valuation was at least $250M (2). General Catalyst & Sequoia participated.

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

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. million at a $15 million pre-money valuation. We ended up agreeing a term sheet for $16.5 Yes, this was stupid.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

Both Sides of the Table

JUNE 22, 2011

In addition to FOMO it is partly driven by massive increase in valuations for earlier-stage companies who raised money at bit seed prices but who still have product risk. million pre-money valuation is now raising $1 million at a $12 million valuation the next investor has nowhere to go but up (or sit out the investment).

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

Gust

NOVEMBER 7, 2011

We recently started a series of posts on establishing the pre-money valuation of pre-revenue startup companies for purposes of investment by seed and startup investors. This calculator uses 25 questions to size up the progress of the new venture and calculate a pre-money valuation for investment purposes.

Valuation 87

Valuation Pre-Money Valuation Venture Capital Technical Review 87

Both Sides of the Table

SEPTEMBER 29, 2009

The pricing problem – So an investor put $5 million at a $10 million pre-money valuation in a company with a great beta product but no real customers. The company was therefore priced at $15 million post-money and the VC (s) own 1/3 rd. It is no wonder why they had less time for new deals.

Burn Rate 263

Burn Rate Valuation Pre-Money Valuation Private Equity 263

Both Sides of the Table

MAY 28, 2018

So when you say $8–10m is your goal and you aren’t at all thinking about your valuation know that a VC hears “$24–40 million pre-money valuation expectations.”

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

YoungUpstarts

SEPTEMBER 11, 2013

Sometimes the list of challenges may feel never ending – from writing the business plan to finding the right partner – but one of the single most important challenges entrepreneurs face is calculating a realistic, defensible pre-money valuation. . What is a pre-money valuation and why should I care?

Pre-Money Valuation 133

Pre-Money Valuation Valuation Angel Investor Cofounder 133

Gust

NOVEMBER 2, 2011

We recently started a series of posts on establishing the pre-money valuation of pre-revenue startup companies for purposes of investment by seed and startup investors. Dave’s valuation model first appeared in a book published by Harvard’s Howard Stevenson in the middle nineties. Add to Pre-money Valuation.

Valuation 79

Valuation Pre-Money Valuation Intellectual Property Southern California 79

Both Sides of the Table

SEPTEMBER 5, 2012

As in, “your money into my company will convert at a 15-20% discount to the next round of capital I raise with a maximum price of $8 million pre-money valuation (or whatever the cap was).” .” What this did is set the maximum price of the deal. Convertible debt with no cap is stupid for investors.

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354

Lightspeed Venture Partners

OCTOBER 29, 2012

The company sought to raise $125,000 for 25% of the comapny, implying a $375,000 pre money valuation. Unsurprisingly, all the sharks passed, based on market size and valuation expectations. SBU sought $300,000 for 10% of the company, implying a $2,700,000 pre money valuation.

Pre-Money Valuation 97

Pre-Money Valuation Offshore Valuation Cofounder 97

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 119

Valuation Silicon Valley Pre-Money Valuation Bootstrapping 119

Both Sides of the Table

SEPTEMBER 10, 2021

A-Rounds used to be $3–7 million with the best companies able to skip this smaller amount and raise $10 million on a $40 million pre-money valuation (20% dilution). These days $10 million is quaint for the best A-Rounds and many are raising $20 million at $60–80 million pre-money valuations (or greater).

Pre-Money Valuation 471

Pre-Money Valuation Valuation Venture Capital Early Stage 471

Gust

JULY 23, 2014

I’m also allergic to funding “bridges to nowhere”, so I would like to hear your explanation of what you are going to do if no money appears to follow your seed round.

Angel Investor 153

Angel Investor Elevator Pitch Pre-Money Valuation Technical Review 153

BeyondVC

APRIL 12, 2005

When I see "hot" companies with revenue less than $5mm raise capital at $50mm pre-money valuations, I start getting worried, and it further reinforces my thinking on where to make good investments. In the end, making good investments is predicated on taking advantage of inefficiencies in the market.

LBO 78

LBO Pre-Money Valuation Technical Review Software Review 78

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.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

VC Cafe

SEPTEMBER 26, 2022

ValuatIon should be a function of value, not ego. Kawasaki’s Law of Pre-Money Valuation: for every full-time engineer, add $500,000; for every full-time M.B.A., Our goals, their goals. subtract $250,000. Guy Kawasaki, author.

Founder 187

Founder Startup Valuation Pre-Money Valuation 187

Both Sides of the Table

OCTOBER 14, 2011

million pre-money valuation, which is a $10 million post-money) you get diluted by 25% (2.5m / 10m). The simplest way to think about this is: If you own 20% of a $2 million company your stake is worth $400,000. If you raise a new round venture capital (say $2.5 million at a $7.5 million or a gain of $1.1 million.

Dilution 394

Dilution Pre-Money Valuation Startup Valuation 394

Altgate

DECEMBER 16, 2010

@altgate Startups, Venture Capital & Everything In Between Skip to content Home Furqan Nazeeri (fn@altgate.com) ← Pre-Money Valuation vs Number of Founders Where Do Tech VCs Invest? But first, let’s look at pre-money valuation by liquidation preference.

Liquidation Preference 39

Liquidation Preference Pre-Money Valuation Term Sheet Valuation 39

Lightspeed Venture Partners

OCTOBER 7, 2012

As Cuban pointed out, this is a “down round” Zomm is seeking $2M for 10% of the company, implying an $18M pre money valuation today. But the company had previously raised $5M for 17% of the company, implying a post money valuation after that investment of $29.4M. The entrepreneur was clearly desperate.

Technical Review 110

Technical Review Technical Cofounder Valuation Pre-Money Valuation 110

Berkonomics

JUNE 5, 2014

Yet, at the pre-revenue stage of development, angel investors price both companies at a pre-money valuation of $1.5 It is possible to grow a company to a valuation of $30 million on one or two angel rounds of investment. It doesn’t seem right, huh? But, it is… and here is why.

Pre-Money Valuation 92

Pre-Money Valuation Valuation Angel Investor Dilution 92

crowdSPRING Blog

APRIL 26, 2013

Q1 Venture Capital Spending & Number Of Deals Down, M&A Activity Drops 44 Percent And Pre-Money Valuations Plummet – [link]. Don’t let Silicon Valley fool you—millenials are the least entrepreneurial generation | Quartz – [link]. Downfalls of Distributed Startups – [link]. ” – [link].

Social Media 90

Social Media Small Business Design Media 90

BeyondVC

APRIL 12, 2005

When I see "hot" companies with revenue less than $5mm raise capital at $50mm pre-money valuations, I start getting worried, and it further reinforces my thinking on where to make good investments. In the end, making good investments is predicated on taking advantage of inefficiencies in the market.

LBO 60

LBO Pre-Money Valuation Technical Review Software Review 60

Startup Professionals Musings

NOVEMBER 26, 2012

How much is NewCo worth to investors at this point (pre-money valuation)? What percentage of NewCo does the investor own after the $1M infusion (post-money ownership percentage)? On the other hand, if the pre-money valuation is $4M, the founders ownership remains at a healthy 80% level.

Valuation 270

Valuation Pre-Money Valuation NPV Intellectual Property 270

David Teten

SEPTEMBER 16, 2014

Villalobos & Payne: “Startup Pre-Money Valuation: The Keystone to Return on Investment” 117. Wiltbank & Boeker: “Returns to Angel Investors in Groups” 3,097. approx 1999-07. 1961- 1996. Mason & Harrison: “Is it worth it?

Angel Investor 114

Angel Investor Technical Review Venture Capital Pre-Money Valuation 114

Both Sides of the Table

SEPTEMBER 8, 2012

We plan to raise at a $5 million pre-money valuation. million pre-money. In the document it outlines that you will issue stock at a $5m pre-money valuation and in recognition of the additional risks and commitments of early money you have allocated warrants to the first $150,000 of investors.

Pre-Money Valuation 294

Pre-Money Valuation Finance Liquidation Preference Warrant 294

Startup Professionals Musings

SEPTEMBER 30, 2011

How much is NewCo worth to investors at this point (pre-money valuation)? What percentage of NewCo does the investor own after the $1M infusion (post-money ownership percentage)? On the other hand, if the pre-money valuation is $4M, the founders ownership remains at a healthy 80% level.

Pre-Money Valuation 246

Pre-Money Valuation Valuation NPV Intellectual Property 246

Both Sides of the Table

FEBRUARY 17, 2011

You’re offered a $9 million pre-money to raise $3 million (e.g. 5 million raised at a $9 million pre-money valuation or 35.7% dilution), I would personally probably avoid the extra money because as an entrepreneur the dilution would put me out of my confort zone. 25% dilution).

Pre-Money Valuation 303

Pre-Money Valuation Dilution Valuation PR 303

Startup Professionals Musings

SEPTEMBER 14, 2010

The price is the percent of ownership given to the investor, calculated as “investment/post-money valuation.” The pre-money valuation is company value today, while the post-money valuation is the pre-money valuation plus the investment amount. Seat on the board.

Term Sheet 227

Term Sheet Pre-Money Valuation Due Diligence Post-Money Valuation 227

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 150

Burn Rate Cap Table Valuation Software Review 150

Startup Professionals Musings

JANUARY 27, 2012

The price is the percent of ownership given to the investor, calculated as “investment/post-money valuation.” The pre-money valuation is company value today, while the post-money valuation is the pre-money valuation plus the investment amount. Seat on the board.

Term Sheet 223

Term Sheet Pre-Money Valuation Due Diligence Angel Investor 223