Pascal's View

JULY 9, 2017

This is a fundamental issue that does, indeed, boil down to understanding the post-money valuation of a company. At its core, this issue points to the lack of understanding about the importance of post-money valuation by both entrepreneurs and investors.

Post-Money Valuation 49

Post-Money Valuation Valuation Cap Table Covenant 49

Both Sides of the Table

JUNE 5, 2015

I am reminded of this problem every time my firm does a financing where a note went before us but more specifically I was reminded by this great post by Brad Feld to talk about the pre-money vs. post-money conversion issue. It’s worth reading his post to understand the problem. Those are the big three.

Pre-Money Valuation 150

Pre-Money Valuation Option Pool Post-Money Valuation Dilution 150

Agile VC

APRIL 17, 2011

At the end of the day Kayak’s playing a key role in the online travel process, but it appears more of the revenue comes from filling top of the conversion funnel rather than the middle or bottom of it. Post-money valuation probably no higher than $12M (2). Pre-money valuation was approx.

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

ithacaVC

JANUARY 24, 2013

One interesting point that comes up a lot is how to factor the convertible debt into the premoney valuation of the Series A round. Option pool: 500,000 shares (some issued, some reserved, but that is typically irrelevant as the whole pool is normally factored into the premoney share price calculation).

Valuation 53

Valuation Balance Sheet Option Pool Dilution 53

Seeing Both Sides

JULY 15, 2009

A typical start-up company will do 2-4 venture capital financings before a successful exit (or, conversely, an ignomious ending). Entrepreneurs often mistakenly focus solely on the pre-money valuation while VCs look at multiple knobs in the negotiation to drive to a set of terms that, in total, they find acceptable.

Pre-Money Valuation 49

Pre-Money Valuation Option Pool Stock Options Post-Money Valuation 49

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. He obviously never launched a startup and got shafted by a co-founder.

Cofounder 40

Cofounder Founder Preferred Stock Startup 40