View from Seed

SEPTEMBER 14, 2021

This post is inspired by some of the earliest conversations I have had with the team here at NextView and since the beginning of my VC journey. Both early- and late-stage startup valuations are currently elevated. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. during this time.

Valuation 156

Valuation Pre-Money Valuation Distribution Early Stage 156

Both Sides of the Table

APRIL 14, 2010

Many companies that are raising B or C venture capital rounds right now raised their initial money in 2005-2008. That means that they likely raised money at a particularly high price relative to 2010 prices. Talk openly about valuation and what they’ll accept so you know what you’re dealing with. It is 2010.

Venture Capital 289

Venture Capital Liquidation Preference Common Stock Dividend 289

Gust

NOVEMBER 4, 2011

Entrepreneurs and investors who have spent any time dealing with convertible debt seed financing transactions are likely to have encountered the subject of valuation caps. was spun out, and the valuation was set by that financing round. These options were granted shortly after MySpace, Inc. Intermix and its advisors weren’t fools.

Valuation 98

Valuation Pre-Money Valuation Merger Vesting 98

Professor VC

FEBRUARY 12, 2015

In the episode, Kristy Kruger talks about picturing unicorns roaming the planes in Africa as a kid and being at a party many years later when the topic of conversation turned to endangered species: It was about a group of five to seven people, kind of standing around the keg, just talking. or a market cap of $800M. And this is not it."

Las Vegas 28

Las Vegas IPO Pre-Money Valuation Valuation 28

Both Sides of the Table

SEPTEMBER 5, 2012

A standard entrepreneur retort I heard back then (2008-09) was “I don’t know what my company is worth now. 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).”

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354

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. Any deal – ANY DEAL – that was pre 9/11 was suddenly in question. History repeated itself in September 2008 with that market crash.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

thestartuplawyer.com

FEBRUARY 24, 2010

do not think being friends or relatives reduces the need for these difficult and/or awkward conversations. Because now you have more to lose than just a company and your (or someone else’s) money. The Startup Lawyer says: April 15, 2008 at 10:58 am [.] (1) And for the love of high-speed internet and all things Web 2.0,

Cofounder 40

Cofounder Founder Preferred Stock Startup 40

venturehacks.com

OCTOBER 21, 2010

If you don’t keep your eyes on the option pool while you’re negotiating valuation, your investors will have you playing (and losing) a game that we like to call: Option Pool Shuffle You have successfully negotiated a $2M investment on a $8M pre-money valuation by pitting the famous Blue Shirt Capital against Herd Mentality Management.

Option Pool 68

Option Pool Pre-Money Valuation Dilution Warrant 68