Both Sides of the Table
SEPTEMBER 10, 2021
What used to be an “A” round in 2011 is now routinely called a Seed round and this has been so engrained that founders would rather take less money than to have to put the words “A round” in their legal documents. You have seed rounds but you now have “pre-seed rounds.” We’re very unlikely to do what people now call an “A Round.”
Up and Running
SEPTEMBER 19, 2017
That’s because obtaining a pre-money valuation for a concept level technology company in excess of $1 million is difficult, particularly for a startup founder without a proven track record. This bore out in the fine print of proposed investment documents.
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Gust
SEPTEMBER 27, 2014
These can be based on things like location (some only invest in a particular country or state), industry (a Life Science fund is simply not going to invest in a new social network for real estate agents), or valuation (a seed fund will not usually invest in a company that is advanced enough to warrant a $10m pre-money valuation), etc.
Lightspeed Venture Partners
OCTOBER 7, 2012
In the real world a fund raising process takes 90 days on average to get to a termsheet, where deal terms are agreed, and another 30-45 days of legal and financial diligence before the legal documents are finalized and the money is wired. Lori believed that the company should make the product themselves, instead of licensing it.
Gust
OCTOBER 21, 2011
To account for scenarios in which the startup is acquired before it has a chance to complete a priced equity financing round, most term sheets and deal documents contain a “ change in control ” provision. In Parts II and III, we looked at commonly used mandatory and voluntary conversion language in convertible notes.
Tim Keane
JANUARY 12, 2010
An average of these ranges results in a pre-money valuation of about $4MM. If similarly situated companies are seeing $3.5MM pre-money valuations, this might become the target valuation. An average of these ranges results in a pre-money valuation of about $4MM.
K9 Ventures
MARCH 23, 2011
Let’s say the company raises $1M ($900K in new money, plus the $100K for the note, just to keep the math simple) at a pre-money valuation of exactly $1M (assume at $1 per share) – same as the pre-money cap in the note. What percent of the company should the note holder get on conversion?
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