The Startup Lawyer

FEBRUARY 4, 2011

The following are some issues to consider and actions to take before accepting an incubator’s offer: (1) Calculate Valuation and Determine Value. Pre-money valuations startups receive from incubators are typically low…really low. 6) Search For the Incubator’s PR and Marketing Efforts.

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

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.   A cumulative dividend can get to be very expensive and is not often a feature in early stage terms.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Professor VC

JANUARY 17, 2008

It is several thousand dollars, which is a lot of cash for a struggling entrepreneur in search of seed funding. Just seems that the guys with the money shouldnt be charging the guys who dont have any.One of the other panelists mentioned that they dont charge the entrepreneurs, but do require them to spring for lunch at a follow-up meeting.

Pre-Money Valuation 28

Pre-Money Valuation Angel Investor Angel Groups Valuation 28

Berkonomics

NOVEMBER 4, 2016

Originally created in the mid 1990’s to help with the imprecise problem of how to value early stage companies, especially those in technology, I developed what soon became known as “The Berkus Method” when published in the popular book, “Winning Angels” by Harvard’s Amis and Stevenson with my permission in 2001.

Valuation 48

Valuation North Carolina Oklahoma City Silicon Valley 48

VC Cafe

SEPTEMBER 26, 2022

ValuatIon should be a function of value, not ego. Kawasaki’s Law of Pre-Money Valuation: for every full-time engineer, add $500,000; for every full-time M.B.A., Because the product and market can likely change in the search for product market fit. Our goals, their goals. subtract $250,000. Guy Kawasaki, author.

Founder 187

Founder Startup Valuation Pre-Money Valuation 187

Professor VC

FEBRUARY 12, 2015

It''s previous financing round was a little over a year prior to the IPO and was a $8M raise at a $60M pre-money valuation led by John Doerr of Kleiner Perkins. In 2008, I made an investment offer of $250K for approximately 38% of the company ($400,000 pre-money valuation). or a market cap of $800M.

Las Vegas 28

Las Vegas IPO Pre-Money Valuation Valuation 28

dondodge.typepad.com

JANUARY 15, 2011

Community is more powerful than money or technology » August 11, 2007 How much equity for investors and employees? Entrepreneurs face some pretty tough questions at a very early stage. Should I take Angel or VC money? How much money should I raise? How much equity should I grant to early employees?

Equity 40

Equity Employee Dilution Valuation 40

www.paulgraham.com

OCTOBER 23, 2010

Googles plan, for example, was simply to create a search site thatdidnt suck. They had three new ideas: index more of the Web, uselinks to rank search results, and have clean, simple web pages withunintrusive keyword-based ads. For example, dating sites currently suck far worse than search didbefore Google.

Startup 105

Startup Cofounder Software Stock 105

www.paulgraham.com

APRIL 28, 2010

4 ] Seed Funding Firms Seed firms are like angels in that they invest relatively smallamounts at early stages, but like VCs in that theyre companiesthat do it as a business, rather than individuals making occasionalinvestments on the side. Angels and even VC firms occasionally do this, but they alsoinvest at later stages.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

www.paulgraham.com

APRIL 28, 2010

2 ] When you negotiate terms with a startup, there are two numbers youcare about: how much money youre putting in, and the valuation ofthe company. The valuation determines how much stock you get. Ifyou put $50,000 into a company at a pre-money valuation of $1million, then the post-money valuation is $1.05

Angel Investor 63

Angel Investor Syndicate Syndication Dilution 63