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Want to Know How VC’s Calculate Valuation Differently from Founders?

Both Sides of the Table

Other founders, “as a privately held company we don’t disclose our valuation.&# Me, “dude, I’m not a journalist. I just want to figure out what a fair valuation is.&# I figured all the VC’s talked so we should. This starts with understanding how VCs and entrepreneurs often see valuation differently.

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Cliff Notes S-1: Kayak ? AGILEVC

Agile VC

Interesting to note that Hafner and English own common stock but also made meaningful investments in the Series A & B rounds. Post-money valuation probably no higher than $12M (2). Pre-money valuation was initially set higher but was adjusted to match the Ser B valuation. Pre-money valuation was approx.

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Term-sheets and Valuations: Thinking about Negotiations - Startups.

Tim Keane

Term-sheets and Valuations: Thinking about Negotiations.   I’ve sat down with entrepreneurs and a copy of a term sheet guide I like [ “Term Sheets & Valuations - A Line by Line Look at the Intricacies of Venture Capital Term Sheets & Valuations ” by Alex Wilmerding, Aspatore Press.] The Valuation Question.

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Building Convertible Debt into the Premoney Valuation

ithacaVC

One interesting point that comes up a lot is how to factor the convertible debt into the premoney valuation of the Series A round. Let’s assume the following: Common Stock outstanding: 3,400,000 shares owned by the founders. I am going to ignore any valuation cap feature. So, $3mm/(3,400,000+500,000) = $.7692

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How to Raise Investor Funding for Your Startup

Early Growth Financial Services

Baze, Partner at Partech Ventures, Carlos Diaz, CEO at Kwarter, and EGFS’ Chief Strategy Officer Glenn McCrae covered raising funds, how-to pitch VCs, and potential sticking points around valuation. Pre-money valuation — The value of the company prior to investment, calculated on a fully-diluted basis.

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Cap Table Clean Up

ithacaVC

The share price is calculated by taking the pre-money valuation and dividing it by the number of shares outstanding pre-money. So Share Price (SP) = Pre-Money Valuation (PMV) / Shares Outstanding (SO). On a fully diluted pre-money basis, that would mean the option pool represents 14.5% (356,758/2,456,758) of the cap table.

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How to Evaluate an Offer from a Startup Incubator

The Startup Lawyer

The following are some issues to consider and actions to take before accepting an incubator’s offer: (1) Calculate Valuation and Determine Value. Pre-money valuations startups receive from incubators are typically low…really low. The “revised for the cash investment only&# pre-money valuation is $600,000. (2)

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