Austin Startup

JUNE 21, 2018

Our pre-money valuation for the seed round is 2 trillion dollars.” Rule 2: Don’t go to prison, hire a regulatory attorney and obey the law. We see a lot of crypto start-up ideas that go something like this: “We’d like to put bananas on the block chain and trade them with utility tokens.

Securities and Exchange Commission 61

Securities and Exchange Commission SEC Pre-Money Valuation Security 61

Both Sides of the Table

JUNE 22, 2011

In addition to FOMO it is partly driven by massive increase in valuations for earlier-stage companies who raised money at bit seed prices but who still have product risk. million pre-money valuation is now raising $1 million at a $12 million valuation the next investor has nowhere to go but up (or sit out the investment).

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

Berkonomics

JANUARY 7, 2021

Few entrepreneurs can do it alone, with subordinate hired help and no expert management to share the burdens, skill sets, and efforts involved in growing the enterprise. Most importantly, the reward is measured by how much added value the total process creates over time. Two: Co-management. Reward for early risk.

Liquidity Event 96

Liquidity Event Pre-Money Valuation Cofounder Initial Public Offering 96

Hunter Walker

AUGUST 7, 2017

Satya and I rarely see less than a 10% pool created at seed and Series A, but are increasingly engaging with founders about 12-15% pools, especially if you’re going to be hiring in-demand engineers (computer vision, AI) and/or (more typically post Series A), building out a senior executive team.

Equity 94

Equity Pre-Money Valuation Option Pool Founder 94

ReadWriteStart

OCTOBER 7, 2010

So at any point, if you are trying to raise money, and you are hearing from investors that you are too early and have too little validation, it may be a good thing. As a thumb rule, try to get enough validation so that you can get to at least a $2 million pre-money valuation before raising equity capital. HirePlug.com.

Valuation 119

Valuation Silicon Valley Pre-Money Valuation Bootstrapping 119

Both Sides of the Table

FEBRUARY 17, 2011

You’re offered a $9 million pre-money to raise $3 million (e.g. 5 million raised at a $9 million pre-money valuation or 35.7% dilution), I would personally probably avoid the extra money because as an entrepreneur the dilution would put me out of my confort zone. 25% dilution). They get the PR bump.

Pre-Money Valuation 303

Pre-Money Valuation Dilution Valuation PR 303

Both Sides of the Table

JUNE 5, 2015

In the old days VCs funded off of a “pre-money” valuation. 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. How much is in the option pool?

Pre-Money Valuation 150

Pre-Money Valuation Option Pool Post-Money Valuation Dilution 150

Lightspeed Venture Partners

NOVEMBER 19, 2012

Interestingly, this new deal actually lowered the pre money valuation for the company. 75,000 for 10% implies a $675,000 pre money valuation. 150,00 for 20% implies a $600,000 pre money valuation. Kevin agreed to this, as did the founder, and a deal was struck.

Pre-Money Valuation 160

Pre-Money Valuation Alabama Valuation Churn Rate 160

YoungUpstarts

SEPTEMBER 4, 2017

For startup founders and CEO’s it’s also just as common to see them place too much focus on the amount of money raised, and the pre-money valuation, rather than the value that each investor can bring to the table. The earlier you back a startup the more important this is likely to be.

Pre-Money Valuation 187

Pre-Money Valuation Seed Stage IP Deal Flow 187

The Startup Magazine

SEPTEMBER 12, 2019

Venture capital affords companies the opportunity to hire hundreds or even thousands of people in one sweeping motion. Just because you can afford to hire, doesn’t mean that you should. Thanks to our independence, we were able to ensure that each and every hire was in line with our vision of what the company stood for.

Early Stage 85

Early Stage Venture Capital Bootstrapping Pre-Money Valuation 85

This is going to be BIG.

JULY 30, 2015

Toss in a few acqui-hires in the $6-8mm post seed. I assumed the following: Seeds are done as a $1mm round on a pre-money valuation of $5mm. Series A's are done as a $5mm round on a pre-money valuation of $15mm. Series B's are done as a $10mm round on a pre-money valuation of $40mm.

Venture Capital 60

Venture Capital Pre-Money Valuation IRR Valuation 60

YoungUpstarts

SEPTEMBER 11, 2013

Sometimes the list of challenges may feel never ending – from writing the business plan to finding the right partner – but one of the single most important challenges entrepreneurs face is calculating a realistic, defensible pre-money valuation. . What is a pre-money valuation and why should I care?

Pre-Money Valuation 133

Pre-Money Valuation Valuation Angel Investor Cofounder 133

ithacaVC

DECEMBER 13, 2013

There are many reasons for this, but fundamentally, it is impossible to calculate a share price for the investment round unless you have complete agreement on how many shares are outstanding pre-money. The share price is calculated by taking the pre-money valuation and dividing it by the number of shares outstanding pre-money.

Cap Table 67

Cap Table Pre-Money Valuation Option Pool Liquidation Preference 67

Early Growth Financial Services

JUNE 26, 2014

Valuation — Know what these terms mean: Fully-diluted — This includes all issued stock and anything that could be converted into common stock (typically after an acquisition or IPO), such as your stock option pool. Pre-money valuation — The value of the company prior to investment, calculated on a fully-diluted basis.

Pre-Money Valuation 51

Pre-Money Valuation Option Pool Dilution Common Stock 51

Berkonomics

JUNE 12, 2014

Few entrepreneurs can do it alone, with subordinate hired help and no expert management to share the burdens, skill sets and efforts involved in growing the enterprise. It is the old story of “100% of nothing is worth far less than 10% of a large number.”. Email readers, continue here.]

Liquidity Event 85

Liquidity Event Pre-Money Valuation Cofounder Initial Public Offering 85

Seeing Both Sides

JULY 15, 2009

Entrepreneurs often mistakenly focus solely on the pre-money valuation while VCs look at multiple knobs in the negotiation to drive to a set of terms that, in total, they find acceptable. The first, and most focused on, is something called the pre-money valuation. What is the promote? Life isn’t fair.”).

Pre-Money Valuation 49

Pre-Money Valuation Option Pool Stock Options Post-Money Valuation 49

Gust

NOVEMBER 4, 2011

In brief, a cap acts to place a limit on the conversion price of a convertible note such that investors are guaranteed a minimum number of shares for their bridge loans if the startup does a priced equity round at a high pre-money valuation – “high” meaning above the cap, which is often a heavily negotiated term. (The

Valuation 98

Valuation Pre-Money Valuation Merger Vesting 98

The Startup Lawyer

AUGUST 12, 2010

Occassionally, a startup will get a term sheet from an angel with a pre-money valuation less than the investment amount (i.e., the angel wants control of the startup).

Pre-Money Valuation 76

Pre-Money Valuation Angel Investor Term Sheet Valuation 76

www.mattbartus.com

DECEMBER 9, 2012

Let’s say you receive a term sheet for a $1 million investment at a $3 million fully diluted pre-money valuation, and you’re kind of disappointed. Take a look at the numbers: Pre-Money. One possibility is to negotiate a higher valuation and offer warrants (i.e., Post-Money. Option Pool.

Warrant 40

Warrant Valuation Pre-Money Valuation Term Sheet 40

VC Cafe

SEPTEMBER 26, 2022

So in terms of hiring, get people that can help you build the product faster… anything that minimizes the time between observing a need or a problem, and the execution or the fix for it.” ValuatIon should be a function of value, not ego. Early hires are super important: check for skills, motivation and cultural fit.

Founder 187

Founder Startup Valuation Pre-Money Valuation 187

Up and Running

SEPTEMBER 20, 2021

For instance, the cap table will help you with various possibilities while running business activities like available options and pre-money valuations faster. This can be helpful when you are hiring a COO for the company, and the candidate asks to get percentage ownership in the company. percent going to Investor C.

Cap Table 112

Cap Table Pre-Money Valuation Stock Options Option Pool 112

This is going to be BIG.

MARCH 23, 2015

So whereas seed rounds five years ago may have been less than a million dollars on a pre-money valuation of three or four million, today''s seed is up and over a million and usually closer to two million, with post money valuations nearing $10 million. If you''re worried about the runway, try doing less things.

Post-Money Valuation 60

Post-Money Valuation Valuation Pre-Money Valuation Seed Money 60

Both Sides of the Table

SEPTEMBER 5, 2012

As in, “your money into my company will convert at a 15-20% discount to the next round of capital I raise with a maximum price of $8 million pre-money valuation (or whatever the cap was).” What happens in a sale or acqui-hire? .” What this did is set the maximum price of the deal.

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354

thestartuplawyer.com

FEBRUARY 24, 2010

Who must be a co founder and who can remain a hired principal? When I find, and hire on options, the three perfect CEs/directors must I consider them co founders and treat them accordingly? Who must be a co founder and who can remain a hired principal? He obviously never launched a startup and got shafted by a co-founder.

Cofounder 40

Cofounder Founder Preferred Stock Startup 40

venturehacks.com

OCTOBER 21, 2010

SUPPORTED BY Products Archives @venturehacks Books AngelList About RSS The Option Pool Shuffle by Nivi on April 10th, 2007 “Follow the money card!&# – The Inside Man, Three-Card Shuffle Summary: Don’t let your investors determine the size of the option pool for you. The option pool lowers your effective valuation.

Option Pool 68

Option Pool Pre-Money Valuation Dilution Warrant 68

crowdSPRING Blog

APRIL 26, 2013

5 Hiring Mistakes That Can Crush Your Company’s Culture – [link]. Q1 Venture Capital Spending & Number Of Deals Down, M&A Activity Drops 44 Percent And Pre-Money Valuations Plummet – [link]. Activity Based Pricing: When Is It The Right Choice for Your Startup? – [link].

Social Media 90

Social Media Small Business Design Media 90

www.paulgraham.com

APRIL 28, 2010

For example, a seed firmshould be able to give advice about how to approach VCs, which VCsobviously dont need to do; whereas VCs should be able to giveadvice about how to hire an "executive team," which is not an issuein the seed stage. You dont have to spend time on bureaucraticstuff, because you havent hired any bureaucrats yet.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

Seeing Both Sides

NOVEMBER 30, 2008

For the last five years, it was not atypical for a high-quality Series A company that raised an initial round of capital priced at, say, $5 million on a $5 million pre-money valuation to hit a few important milestones (e.g.,

Pre-Money Valuation 20

Pre-Money Valuation Portfolio Post-Money Valuation Valuation 20

www.paulgraham.com

OCTOBER 23, 2010

One of the best tricks I learned during our startup was a rule for deciding who to hire. And when businesspeople try to hire hackers, they cant tell which ones are good.Even other hackers have a hard time doing that. When we got real funding nearthe end of 1996, we hired a great CFO, who fixed everything retroactively.

Startup 105

Startup Cofounder Software Stock 105

This is going to be BIG.

SEPTEMBER 7, 2012

I think I'm terrific at helping early stage teams by rolling up my sleeves and doing what's necessary--getting them hires, PR, product strategy help to find that market fit. If you're investing at pre-money valuations in the low to mid single digits, then how much worse can the next round even get? Down from what?

Later Stage 99

Later Stage Down Round Pre-Money Valuation Early Stage 99

www.currentlyobsessed.com

MAY 28, 2010

Instead of “We are worth about $5m because we have done XYZ and we need to raise $1m, so let’s sell 20%&# it’s better to think about valuation as an output variable, like “Let’s raise $2mm and sell 33%, our (pre-money) valuation is therefore $4mm.&# Future value is key.

Valuation 42

Valuation Channel Pre-Money Valuation Term Sheet 42

Startup Lessons Learned

JUNE 19, 2019

So the venture process was all about trying to figure out whether or not people could deliver what they said they could, and you typically invested as early as possible at a $5 million pre-money valuation, hoping the company would be worth $500 million, in which case you'd make 20 to 30 times your money.

Silicon Valley 159

Silicon Valley Lean Venture Capital Pre-Money Valuation 159