Both Sides of the Table
JULY 22, 2010
Back in 1999 when I first raised venture capital I had zero knowledge of what a fair term sheet looked like or how to value my company. Due to competitive markets we ended up with a pretty good term sheet until we needed to raise money in April 2001 and then we got completely screwed. I turned them down. They were nonplussed.
Both Sides of the Table
SEPTEMBER 28, 2014
by Michael Woolf that is worth any startup founder reading to get a sense of perspective on the reality warp that is startup world during a frothy market such as 1997-1999, 2005-2007 or 2012-2014. The more you burn the higher your investor’s leverage relative to you is if you start to run out of money and don’t have options.
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Both Sides of the Table
SEPTEMBER 25, 2010
Taking it from an investor perspective (not me, angels) I think it’s totally unfair to see early angels invest, take more risk, help you get to the next level through both sweat & money, and then pay a higher price because the round had a convertible note with no cap. I agree on all points. I chuckled.
Both Sides of the Table
NOVEMBER 4, 2009
Let’s assume that the company raised it at a normal VC valuation, which means it gave up 33% of the company and thus $5 million / 33% = $15 million post-money valuation. It was 1999. OK, you would own 0.25% of the stock. They raised $5 million in their B round. It was easy to do these calcs.
Feld Thoughts
FEBRUARY 9, 2016
I started investing in 1994 and while there was some bumpiness in 1997 and again in 1999, the real pain happened between 2000 and 2005. This is a little tricky in early rounds and with modest up-round financings, as you’ll often have a liquidation preference that is high relative to your overall valuation.
The Startup Lawyer
OCTOBER 9, 2010
Good luck trying to convince even the most nascent of startups to take your investment at around a $100k post-money valuation. Partying like it’s 1999 is one thing — running an 2010 accelerator like it’s 1999 is probably not a great idea. (c) Pretty expensive seed capital. c) Mentorship is key.
Ben's Blog
JULY 16, 2013
If you run a startup and are currently raising money, you probably planned for a somewhat different fundraising environment than the one you find yourself in today. You probably thought that valuations would be roughly the same as they were the last time you raised money. 3/31/1999: 49.7. But they most certainly are not.
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