Both Sides of the Table

MAY 28, 2018

It’s true that some later-stage private equity firms like to fund “roll ups” (a company that acquires many related companies in it sector), but this is seldom the domain of VCs. Every VC knows that the amount you raise is often a proxy for your valuation. Every VC wants to fund a deal that seems to have too much demand.

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

VC Cafe

SEPTEMBER 22, 2022

But becoming a Unicorn, or receiving a billion dollar valuation is no longer an indication of growth. Sorry for the humbrag, but I’m proud to see Minute Media , our Remagine Ventures portfolio company (and our only later stage investment) on this prestigious list. ” Bessemer. Israeli startups raised a record of $26.6

Software Review 109

Software Review B2C Open Source 109

Startup Professionals Musings

MARCH 12, 2023

Angels are more likely to fund new entrepreneurs, and early-stage or seed rounds, while VCs tend to focus on entrepreneurs with a successful track record, and later stage rounds. VCs tend to demand more control of your spending and strategic decisions, with required board seats and lower valuations.

Angel Investor 246

Angel Investor IRR Venture Capital Valuation 246

Both Sides of the Table

MAY 24, 2021

But markets have changed and I think investors, founders and experienced executives who want to join later-stage startups can all benefit from playing the long game. Case in point, Procore just went public and is trading at an $11 billion valuation. It literally drove FOMO. This “overnight success” was first financed in 2004.

Venture Capital 363

Venture Capital LP Valuation Later Stage 363

Both Sides of the Table

OCTOBER 12, 2014

They often create the biggest tensions between investors who are investing at different stages in the business. 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.

Technical Review 336

Technical Review Later Stage Early Stage LP 336

Both Sides of the Table

JUNE 5, 2011

2: As expected at least one person accused me of writing this post because I want to see lower valuations. The earlier you invest the higher the chances the company won’t work out and thus you pay a lower price than later-stage investors. You can be pissed off, but I don’t set prices. That’s stupid.

Pre-Money Valuation 336

Pre-Money Valuation Valuation Silicon Valley Stock 336

Both Sides of the Table

MARCH 1, 2016

LPs See The Over-Valuations and Don’t Like It. LPs have followed the recent press about the over-valuation and over-funding of the startup industry, and they experience these phenomena first hand. The Biggest Area of Concern is Late Stage Investments. All isn’t completely rosy in the LP views of the venture industry.

Venture Capital 150

Venture Capital LP Silicon Valley Marketing 150

Both Sides of the Table

JUNE 30, 2011

With more competition in early-stage many VCs are investing smaller amounts at earlier stages. Some are going later stage to not miss out on hot deals. I call this “stage drift.&#. The coming brick wall will ensure that valuations reach their natural limitations and return to normalcy.

Venture Capital 289

Venture Capital Early Stage Valuation Angel Investor 289

Startup Professionals Musings

FEBRUARY 15, 2023

Most new teams are geographically dispersed these days anyway, so paying rent for an office should be differed to later stages when revenue is plentiful. Defer your desire for expensive perks and vacations until later when you have time for them. With the advent of the Internet, the size and address of your office is irrelevant.

Equity 349

Equity Hockey Stick Bootstrapping Sweat Equity 349

Steve Blank

APRIL 23, 2014

VCs like acquisitions as much as IPOs because the acquiring companies often can rationalize paying large multiples over the current valuation of the startup. However, these nosebleed valuations make it even more important in getting the acquired company integrated correctly.

Acquisition 332

Acquisition Intellectual Property Silicon Valley Startup 332

Startup Professionals Musings

JUNE 13, 2020

Angels are more likely to fund new entrepreneurs, and early-stage or seed rounds, while VCs tend to focus on entrepreneurs with a successful track record, and later stage rounds. VCs tend to demand more control of your spending and strategic decisions, with required board seats and lower valuations.

Angel Investor 314

Angel Investor Entrepreneur IRR Valuation 314

Steve Blank

MARCH 17, 2020

They triage their deals – first worrying about liquidity of their late stage deals which have the highest valuations. In every major downturn inflated valuations disappear and the few VC’s still writing new checks find it’s a buyer’s market. ” exercise. Hence the term “Vulture Capitalists.”).

Burn Rate 436

Burn Rate Startup Valuation Sales Cycle 436

Both Sides of the Table

FEBRUARY 15, 2016

There is much talk these days that startup valuations have decreased and may continue to do so and that the amount of time it takes to fund raise may take longer. The earlier the round, the less capital you need and the more reasonable your valuation the less time that is needed generally to raise capital. Only you know.

Burn Rate 150

Burn Rate Cap Table Valuation Software Review 150

Berkonomics

AUGUST 24, 2023

We have previously made the case that professional investors demand more in the form of restrictive covenants and lower valuations. Without the VC guidance there would have been little opportunity to even dream of a billion-dollar valuation goal. This statement could be considered controversial.

Covenant 118

Covenant Angel Investor Valuation Later Stage 118

thebarefootvc

JANUARY 27, 2014

Do I think we are in a valuation bubble? I think that later stage valuations are frothy (for reasons I explain below) while earlier stage valuations are starting to stabilize from previous highs (with the exception of the superstar serial entrepreneur) - turns out scaling in a sea of competition (both startup and entrenched) is not so easy.

Technical Review 63

Technical Review Valuation Venture Capital Investment Bankers 63

VC Adventure

AUGUST 15, 2018

However the board could determine what that fair market value was and, generally speaking, there wasn’t a practical way that these valuations could be challenged. Over night a cottage industry was created to conduct these valuations. Similarly I assumed that later stage companies would also show a smaller gap.

Valuation 48

Valuation Common Stock Cap Table Software Review 48

VC Cafe

SEPTEMBER 28, 2023

For those that did tap VCs, 90% were either Seed or Series A stage companies. Fewer established Series B+ startups shuttered operations, though the 34 later stage shutdowns exceeded last year’s 25. Startups that raised in 2021 and 2022 often at high valuations, had to adjust quickly to the new market conditions of 2023.

Valuation 103

Valuation Startup Angel Investor Dilution 103

View from Seed

SEPTEMBER 14, 2021

Or is there a major disconnect between a portfolio’s valuations and the actual dollars returned to LPs? Both early- and late-stage startup valuations are currently elevated. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. How have more recent vintages performed?

Valuation 319

Valuation Pre-Money Valuation Distribution Early Stage 319

VC Cafe

JANUARY 2, 2023

There are 85 Israeli unicorns, but only about 50% them justify a billion Dollar valuation, according to Viola’s report. As growth investments (and valuations) go down, unicorns might struggle to survive, according to Globes. As a result, I expect to see slower pace of investing across stages. ” Fred Wilson.

Valuation 158

Valuation Down Round Venture Capital 158

Startup Professionals Musings

MAY 18, 2020

Most new teams are geographically dispersed these days anyway, so paying rent for an office should be differed to later stages when revenue is plentiful. Defer your desire for expensive perks and vacations until later when you have time for them. With the advent of the Internet, the size and address of your office is irrelevant.

Hockey Stick 423

Hockey Stick Bootstrapping Sweat Equity Intellectual Property 423

Startup Professionals Musings

MAY 4, 2016

Who would not want to joint the unicorns (recent startups with a current valuation of over $1 billion)? You don’t have to be a heavily funded later stage startup to get access to “big data,” customer analytics, and metrics dashboards. Angel groups, accelerators, and incubators are pervasive.

Intellectual Property 120

Intellectual Property Startup Angel Groups Social Media 120

David Teten

DECEMBER 3, 2019

Data companies focused on early-stage startups include Aingel , fundsUP , Preseries , PredictLeads , and Sploda. Later stage investors are using for sourcing private company marketplace services focused on more established companies, listed below under “Step 11: Exit”. They read reviews of the products of target investments.

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

The Equity Kicker

AUGUST 19, 2015

In the words of an alum from the 2006 cohort: Companies are joining YC at a much later stage. Note that these returns are from the value of YC’s stake in the company, not the total valuation. That marks a shift in the YC investment strategy which used to focus on younger businesses.

Later Stage 60

Later Stage Private Equity Venture Capital Valuation 60

View from Seed

SEPTEMBER 14, 2021

Or is there a major disconnect between a portfolio’s valuations and the actual dollars returned to LPs? Both early- and late-stage startup valuations are currently elevated. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. How have more recent vintages performed?

Valuation 295

Valuation Pre-Money Valuation Distribution Early Stage 295

Both Sides of the Table

JULY 27, 2014

We both agree that the later-stage valuations are being driven up to a point that feels irrationally priced [he uses b-round SaaS valuations as an example and I am willing to be even more broad based]. Video 1 is here : Late stage valuations are in a mini bubble.

Valuation 309

Valuation Pre-Money Valuation Later Stage Non-Compete 309

The Next Web

SEPTEMBER 13, 2013

Many Asian entrepreneurs tell me that they want to raise funds from Silicon Valley firms because they perceive the valuations to be higher. But the problem with this is that most VCs in the Valley, especially early stage ones, only like to invest in companies that are within driving distance from their offices.

Asia 132

Asia Silicon Valley India Term Sheet 132

Steve Blank

OCTOBER 24, 2017

And in later stage rounds an explosion of corporate VCs and hedge funds now want in to the next unicorns. Visionary CEOs have always been the face of their company, but today with social media, it happens faster with a much larger audience; boards now must consider what would happen to the valuation of the company without the founder.

Founder 245

Founder Technical Review CTO Hire IPO 245

Both Sides of the Table

MAY 4, 2013

When you are raising a large, later-stage round given by this time you’ve likely got a fairly large business to run. I have always advised startup companies against letting valuations get massively ahead of market norms. International money. Same as strategic – hard to reach, hard to get to know easily.

Deal Flow 347

Deal Flow Early Stage Investment Bankers Technical Review 347

Berkonomics

AUGUST 3, 2023

My experience with early valuations by founders for friends… I’ve arrived at a significant number of companies that were looking for additional growth capital after a “friends and family” round and had to “clean up” the cap table more than a few times over the years.

Private Equity 118

Private Equity Valuation Cap Table Accredited Investor 118

Feld Thoughts

MARCH 24, 2017

We know many firms that build portfolios with great logos by buying into companies at later stages and higher valuations. FC’s portfolio is made up exclusively of seed stage investments at seed valuations. When we saw their financial track record, we realized how special the performance was.

Founder 75

Founder LP Technical Review Seed Stage 75

Hunter Walker

JULY 18, 2022

The ‘valuation multiples’ reset also came with an increase in slope of the curve. A drop in growth rate turns into a drop in valuation multiple. In either case, you gotta assume that the goalposts have moved a bit forward for the next round, especially if you’re trying to grow into and surpass your last valuation.

Valuation 117

Valuation Cap Table Startup Later Stage 117

This is going to be BIG.

SEPTEMBER 30, 2012

How else can you explain this headline matching a story about a professional social network still trying to explore revenues raising $17mm on an $80mm valuation? The reality is that, most of the time--like two thirds of the time--the venture market is totally open for good businesses to get fair valuations in reasonable turnaround times.

Venture Capital 114

Venture Capital Marketing Term Sheet Software Review 114

View from Seed

SEPTEMBER 14, 2021

Or is there a major disconnect between a portfolio’s valuations and the actual dollars returned to LPs? Both early- and late-stage startup valuations are currently elevated. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. How have more recent vintages performed?

Valuation 156

Valuation Pre-Money Valuation Distribution Early Stage 156

Both Sides of the Table

MARCH 12, 2017

VCs don’t expect any serious corrections to valuations in 2017 and they seem to be taking financial discipline in later-stage companies more seriously valuing unit economics over “growth at any cost.”

Venture Capital 277

Venture Capital Artificial Inteligence LP Valuation 277

David Teten

SEPTEMBER 23, 2017

Even for later-stage companies with predictable financials, the lack of liquidity, audited financials, and standardized metrics creates real challenges to scaling quantitative investing. Later stage investors are using private company marketplace services focused on more established companies, listed below under “Exit Investments”.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

VC Adventure

MAY 5, 2022

BUT (and you knew there was a but here given the post title…) it’s a poor way to compare the relative performance of funds early, and even into the mid/later, stages of a fund’s life. But there’s a lot of work for these companies (and many, many like them across the venture landscape) to grow into their paper valuations.

IRR 116

IRR Metrics Valuation LP 116

Both Sides of the Table

MAY 4, 2013

When you are raising a large, later-stage round given by this time you’ve likely got a fairly large business to run. When you are trying to raise “strategic money” since these people are often hard to reach and they are often more used to being approached by bankers. International money.

Early Stage 361

Early Stage Deal Flow Investment Bankers Technical Review 361