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What Most People Don’t Understand About How Startup Companies are Valued

Both Sides of the Table

Valuing any company can be difficult because it requires a degree of forecasting future growth & competition and ultimately the profits of the organization. No you’re kind of f *d because nobody wants to buy any at all and your bank is calling you concerned that you may need to slow down your pace of new purchases for a bit.

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In Venture Capital, Should You Be a Momentum or a Value Investor?

David Teten

Likely signs of a Value investment: the company has challenges in filling out the round; the investors have more negotiating leverage than the founders during the closing process; the company has significantly better metrics (e.g. You could argue that when they were [raising] oversubscribed [VC rounds], Facebook, Google, Amazon, etc.,