Both Sides of the Table
OCTOBER 12, 2014
These tensions seep out in some angels or seed funds publicly or semi-privately deriding later-stage VCs for their “bad” behavior. I have seen bad behavior from later-stage VCs, believe me. But I have seen equally bad behavior from super early stage investors. As always a balanced perspective is in order.
Rob Go
AUGUST 29, 2016
When I first started out as a VC nearly 9 years ago, most early stage company valuations were expressed as pre-money valuations. That is, the valuation of the company prior to the investment of new capital. Today, nearly all early stage term sheets I see are expressed as post-money valuations.
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Both Sides of the Table
JULY 22, 2010
How VC’s Calculate Valuation : We walked through a standard deal where you raise $1 million at a $3 million pre-money valuation leading to a $4 million post money valuation. Privately some early-stage VC’s talk about participation helping them to “juice their returns&# on smaller exits.
Both Sides of the Table
SEPTEMBER 25, 2010
This leads to the problem of “herding cats&# for entrepreneurs raising angel money. I talked about this in my social proof post where I gave some suggestions about how to get the early guys off of the fence. This gives you the ability to get the first money in the bank while giving you flexibility in size of round.
Both Sides of the Table
SEPTEMBER 28, 2014
but that’s our firm’s money on your balance sheet. We want money to make some acquisitions (investors would prefer to fund M&A if they know specific deals – not to encourage bad behavior. Plus, most early-stage M&A fails so this isn’t likely a good use of capital for a young company).
Both Sides of the Table
JUNE 5, 2015
If you add the pre-money valuation (let’s say $8 million) to the amount of money you’re raising (let’s say $2 million) you get the post-money valuation. Pre-money ($8m) + investment ($2m) = Post-money ($10m) and the investors now own 20% of your company $2m / $10m.
Both Sides of the Table
JUNE 5, 2011
Early-stage investors in technology startups are only looking for growth-oriented companies that can achieve an “exit&# someday – either via selling your company to a larger company or via an IPO. So rounds tend to be “range bound&# where the top end of the valuation spectrum often being done in boom markets (i.e.
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