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What Does the Post Crash VC Market Look Like?

Both Sides of the Table

When you look at how much median valuations were driven up in the past 5 years alone it’s bananas. Median valuations for early-stage valuations tripled from around $20m pre-money valuations to $60m with plenty of deals being prices above $100m.

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Equity for Early Employees in Early Stage Startups

SoCal CTO

I was asked by a reader how much equity he should give out to early employees and to service providers in a very early stage startup. Founders vs. Early Employees To help with this discussion, let me start with a definition of "early employee." I'll get to service providers in a later post.

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Why Raising Too Much Money Can Harm Your Startup

Both Sides of the Table

There is a general guideline of how much investors want to own in order to invest in your company and the norm is 15–30% with the most common range 20–25% per early stage round. A $15–20 million valuation sounds better than an $8 million valuation, doesn’t it? But it’s actually not that silly.

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Web-Based Worthworm Helps Determine PMV For Startup Investment Purposes

YoungUpstarts

“The reality is that there has not been a reliable, simple, or cost-effective way to calculate an early stage company’s valuation – which is why so many entrepreneurs and angel investors get it wrong,” says Alan Lobock, co-founder of Worthworm.

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The Changing Venture Landscape

Both Sides of the Table

A-Rounds used to be $3–7 million with the best companies able to skip this smaller amount and raise $10 million on a $40 million pre-money valuation (20% dilution). These days $10 million is quaint for the best A-Rounds and many are raising $20 million at $60–80 million pre-money valuations (or greater).

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

Both Sides of the Table

I couldn’t understand why they wanted so many options until a friend pointed out that this just lowered their “true&# pre-money valuation (they also asked for some sharp elbowed terms in the deal). So let’s start calling the term sheet listed pre-money valuation as the “nominal&# pre-money valuation.

Valuation 405
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Why Startups Should Raise Money at the Top End of Normal

Both Sides of the Table

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. while acknowledging that San Fran deals are often higher valuations due to increased competition amongst investors.