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When Should Startup Founders Discuss Valuation with Seed VCs?

View from Seed

Using NextView as an example, since we both seek to lead the seed round and only lead during this round, I’ve seen this trend manifest in one of two ways: In a priced round, the entrepreneur will often share their valuation ask (or a stated floor) for the pre-money valuation of their company much sooner in the process.

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Financing Acquisitions: Keys to Structuring the Deal And Obtaining The Funding

YoungUpstarts

To safeguard your team from getting emotionally over-committed to a specific business, carefully balance the price being offered for the target, the strategic problem or opportunity it addresses, the likely near-term cash flow of the target, the integration strategy, the inherent risks and the deal structure.

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5 Risks Of Buying A Business And Profiting Off The Opportunities They Create

YoungUpstarts

The opportunity: Use this as a negotiating point when bargaining for the deal. If the business IS the business owner, then that person needs to be part of the deal. Structure the buy-out to include an employment contract or consulting agreement, as well as an earn-out. Ask about the company culture and decide what parts to keep.

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Signaling Pricing Expectations Early in Seed Investment Discussions

Genuine VC

By communicating pricing expectations with potential lead investors, I mean sharing either an “ask” or even stated floor for the pre-money valuation of the company (with a priced preferred round) or explicitly stating a valuation cap (for convertible note round).

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10 Tips for Startups Raising Money from Angels

VC Cafe

Are your costs per acquisition going up or down with scale? Deal structure – I could write a full post just on this, but some aspects that were brought up are the need to agree on a reasonable valuation, what investment vehicles are used (convertible debt vs stock, options and warrants and other non-dilutive mechanisms).

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The Dos And Don’ts Of Selling Your Business

Duct Tape Marketing

And that's when you open the Pandora's box of getting into process, procedure, methodology is the, you know, everything in the business running through that owner is the owner, got his hands on, you know, every deal, every sale. So we could go, we could spend the rest of our time talking about valuation. And that's gonna cost me money.

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The Pre-Seed FAQ

K9 Ventures

Yes, the infrastructure is cheap (to start), but the human costs have gone up dramatically. The amount of capital (and therefore the resulting valuation) also sets the stage for the next round of financing for a company. Q: How are most Pre-Seed deals structured? Those times are long gone.