Both Sides of the Table

FEBRUARY 25, 2010

million at a $15 million pre-money valuation. My co-founder and other management team members wanted us to hold off and see whether we could get the deal done at a higher price. We moved into the legal process and final due diligence in January and February of 2000. Our final closure was the first week of March 2000.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

Both Sides of the Table

JULY 27, 2014

We both agree that the later-stage valuations are being driven up to a point that feels irrationally priced [he uses b-round SaaS valuations as an example and I am willing to be even more broad based]. Most of those industries are fee-based and are competing on revenue growth. I don’t totally agree with that view.

Valuation 309

Valuation Pre-Money Valuation Later Stage Non-Compete 309

Steve Blank

MARCH 31, 2014

I’m honored to be at a university noted for knowledge, and in a city with 2000 years of history – home of Gaudí one of the 20 th century’s greatest innovators. Companies horde cash and squeeze the most revenue and margin from the money they use. Look at the valuations of companies like Tesla, Illumina, and Twitter.

Private Equity 325

Private Equity Metrics China Intellectual Property 325

Agile VC

MAY 26, 2011

Many assume it was a cakewalk, based on the success LinkedIn has enjoyed over time and the current stature of our founder/CEO Reid Hoffman (now Chairman). Silicon Valley is still emerging from the tech bubble and massive downturn of late 2000-2002. Google is still a private company (their IPO was Aug 2004). It was a $4.7M

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

Steve Blank

MARCH 18, 2011

The signals are loud and clear : seed and late stage valuations are getting frothy and wacky, and hiring talent in Silicon Valley is the toughest it has been since the dot.com bubble. VC’s worked with entrepreneurs to build profitable and scalable businesses, with increasing revenue and consistent profitability – quarter after quarter.

Internet 334

Internet IPO Silicon Valley Agile 334

Austin Startup

AUGUST 20, 2017

Keep the valuations consistent with company progress. Kalanick, former investor BFF turned highly disappointed by founder behavior. The bottom line is that the pedigree of your investors will have much to do with your ultimate valuation and with your enjoyment of the startup experience. How about your Investors ?

Technical Review 48

Technical Review Software Review Cap Table Securities and Exchange Commission 48

Steve Blank

JULY 15, 2010

The two decades from 1979 when pension funds fueled the expansion of venture capital to 2000 when the dot-com bubble burst were the Golden Age for entrepreneurs and venture capital firms. Until 1995 startups going public typically had a track record of revenue and profits. Number of Venture Backed Liquidity Events 1991-2000.

Venture Capital 297

Venture Capital IPO Liquidity Event Entrepreneur 297

www.inc.com

SEPTEMBER 24, 2011

Last spring, Dave Graham , founder of software consulting firm Arizona Bay, learned that a major client, Jumpstart Automotive Media, had been acquired for more than $80 million. Jumpstart was one of Grahams first clients; it signed on shortly after he founded Arizona Bay, in 2000. It should have been a cause for celebration.

Arizona 40

Arizona Equity Iowa Venture Capital 40

Agile VC

JANUARY 21, 2015

A population of founders, employees, investors, advisors, and others all aligned in trying to build large disruptive businesses is naturally prone to lofty, even over-the-top language. Not every round of funding is closed at a “monster” valuation. We went public in 2002 and eBay bought the company later that year for over $1.5

Cofounder 188

Cofounder Seed Stage Employee PR 188

The Equity Kicker

AUGUST 25, 2015

I saw that in 2000 and then again in 2008. When the macro economic climate is tough less money flows into venture funds and startups, so fewer deals get done, valuations are lower and more companies fail. Making things worse still, consumers and enterprises have less money to spend and startups find it harder to grow revenues.

Valuation 60

Valuation Startup Stock Portfolio 60

David Teten

AUGUST 7, 2019

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. LTV / CAC, revenue growth, etc.) THEREFORE: we don’t need to be valuation-sensitive.

Venture Capital 60

Venture Capital Valuation Stock NDA 60

Up and Running

OCTOBER 17, 2017

Keep a cash cow: Your monthly revenue goal. Specify how much revenue you need to be generating from your startup for you to let go of other responsibilities (such as a part or full-time job) to be able to focus entirely on your new business. Is it $2000, $3000, five, six, or seven clients per month?

Cofounder 125

Cofounder Revenue Valuation Design 125

View from Seed

JANUARY 20, 2015

A population of founders, employees, investors, advisors, and others all aligned in trying to build large disruptive businesses is naturally prone to lofty, even over-the-top language. Not every round of funding is closed at a “monster” valuation. We went public in 2002 and eBay bought the company later that year for over $1.5

Cofounder 120

Cofounder Startup Employee PR 120

Both Sides of the Table

FEBRUARY 14, 2016

I’d like to explain as best I can my opinion on what is going on because most of what I hear from entrepreneurs is not only wrong but is reminiscent of what I heard in 1997-2000. I have been talking about my concerns about valuations for the past couple of years because, well, they’ve been rising very rapidly the past two years!

Valuation 150

Valuation Down Round Startup Later Stage 150

ReadWriteStart

MAY 25, 2018

Cryptocurrency startups, much like the dot-coms, are experiencing an influx of capital that’s boosting the valuations of solid, innovative companies along with their relatively worthless counterparts — Dogecoin comes to mind as a cautionary tale. In November 2000, an index of 280 internet stocks was down by $1.7

South Korea 114

South Korea Silicon Valley Sweden Africa 114

Agile VC

JANUARY 21, 2015

A population of founders, employees, investors, advisors, and others all aligned in trying to build large disruptive businesses is naturally prone to lofty, even over-the-top language. Not every round of funding is closed at a “monster” valuation. We went public in 2002 and eBay bought the company later that year for over $1.5

Cofounder 100

Cofounder Seed Stage Employee PR 100

Cracking the Code

OCTOBER 13, 2020

This summer saw two record transactions within a month, as UiPath became the first European Cloud decacorn in July and Visma, a Norwegian company, became the world’s largest ever software buyout with a $12B+ valuation. The average revenue multiple is now 17x+, close to 10 times higher than during the 2008 crisis!

Europe 71

Europe Cloud Silicon Valley 71

Ben's Blog

JULY 16, 2013

You probably thought that valuations would be roughly the same as they were the last time you raised money. Perhaps you are caught in the “Series A crunch” or perhaps you are a consumer company and expected that you would be valued on users rather than revenue like the last time. 3/31/2000: 73.4. But they most certainly are not.

Down Round 78

Down Round Marketing Preferred Stock Post-Money Valuation 78

Up and Running

DECEMBER 9, 2014

My founders and I started the company about three years ago. Bates: Josh, it reminds me of when I was doing web sites back in the day in 2000 and 1998 and instead of going and being able to buy a shopping cart you had to code the shopping cart from scratch. Two, revenue. Bates: You know Josh—. What do you do? Three, growth rate.

Small Business 95

Small Business Finance Forecast Metrics 95

Ben's Blog

JULY 16, 2013

You probably thought that valuations would be roughly the same as they were the last time you raised money. Perhaps you are caught in the “Series A crunch” or perhaps you are a consumer company and expected that you would be valued on users rather than revenue like the last time. 3/31/2000: 73.4 But they most certainly are not.

Marketing 46

Marketing Preferred Stock Post-Money Valuation Down Round 46

Seeing Both Sides

AUGUST 3, 2012

With over $1 billion in revenue, 2000 employees and a market capitalization of over $6 billion, Akamai has become a role model for scalable start-ups. billion in revenue, over $1 billion in gross profit and $500 million in EBITDA. The first year of revenue (1999) was $4 million – a remarkable achievement. Gross Profit. $(60).

Distribution 49

Distribution Lean Massachusetts Cofounder 49

VC Cafe

AUGUST 15, 2011

ICQ FOUNDER SELLS ISRAEL’S DOTOMI FOR $295 MLN. Dotomi founder Yair Goldfinger also co-founded ICQ, the technology known today as instant messaging. “ Ophir has a history of impressive revenue growth. ValueClick Inc. acquired digital marketer Dotomi Inc., a leader in personalized media, for $295 million.

China 90

China Cofounder India 90

VC Cafe

NOVEMBER 9, 2011

There were over 2000 participants and around 100 speakers from all over the world. The US markets have generally proven themselves as giving better valuations, and long term liquidity.”. If you don’t have over 100-150 million in revenue, then stay private, it is quite hard in the public market with that little revenue.”

IPO 92

IPO Cofounder Europe 92

Altgate

MARCH 8, 2009

Growth stage investors are usually the Series B or C investors who come in when the product is in the market but there is little or no revenue and the team is probably in the 20-something range with the goal to ramp it up to 40-50 employees with the new money, build out a sales team, etc. But some will be saved. Also, the $1.5

Later Stage 34

Later Stage Early Stage Venture Capital Portfolio 34

www.paulgraham.com

APRIL 28, 2010

VCs are notoriousfor leading founders on. Bootstrapping (= Consulting) Some would-be founders may by now be thinking, why deal with investorsat all? We chargedquite a lot for our software—about $140 per user per month—butit was at least a year before our revenues would have covered evenour paltry costs.

Bootstrapping 77

Bootstrapping Term Sheet Founder Startup 77