Both Sides of the Table

SEPTEMBER 10, 2021

With the enormous changes to our economies and financial markets?—?how how on Earth could the venture capital market stand still? One of the most common questions I’m asked by people intrigued by but also scared by venture capital and technology markets is some variant of, “Aren’t technology markets way overvalued?

Pre-Money Valuation 471

Pre-Money Valuation Valuation Venture Capital Early Stage 471

Gust

NOVEMBER 15, 2011

The Risk Factor Summation Method the fifth methodology for estimating the pre-money valuation of pre-revenue companies we have described in recent posts. Sales and marketing risk. For more information on determining the average valuations in your area, see the Scorecard Method. million pre-money valuation.

Valuation 102

Valuation Pre-Money Valuation Ohio Early Stage 102

Both Sides of the Table

JULY 23, 2014

We are in a bubble (with so many private $1bn+ valuations). 15 years ago we were at the peak of Internet hype with the launch of many over-capitalized businesses with a market size & opportunity was limited. The VC market has right-sized (returned back to mid 90′s levels & less competition). Where are we today?

Technical Review 398

Technical Review Venture Capital Valuation Pre-Money Valuation 398

Both Sides of the Table

MAY 28, 2018

Of course the VC is looking to have specificity in how you plan to spend the money you’re going to raise and plans that show a pie chart that says, “25% on marketing, 30% on technology and R&D, 20% on infrastructure, 25% on G&A” do not get funded. Yes, I see plans this pedestrian. This is a red flag for VCs.

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

Agile VC

APRIL 17, 2011

AGILEVC My idle thoughts on tech startups. Last week ZipCar began trading and has a market cap of about $1 billion. Pre-money valuation was initially set higher but was adjusted to match the Ser B valuation. Pre-money valuation was approx. Pre-money valuation was approx.

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

Startup Professionals Musings

NOVEMBER 26, 2012

The founders now need a $1M Angel investment to do the marketing for a national NewCo rollout, build a team to manage the rollout, and maybe even pay themselves a salary. How much is NewCo worth to investors at this point (pre-money valuation)? Look at the size of the market, and the growth projections for your sector.

Valuation 270

Valuation Pre-Money Valuation NPV Intellectual Property 270

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.

Burn Rate 150

Burn Rate Cap Table Valuation Software Review 150

Both Sides of the Table

APRIL 20, 2011

As a courtesy if you enjoyed his write-up please check out his startup company, ChannelStack. Twitter wanted to raise money for this new venture at a pre-money valuation which was quite a bit higher than First Round’s $10 million limit. First Round Capital’s pre-money range is usually between $3-5 million.

Pre-Money Valuation 284

Pre-Money Valuation Technical Review Cofounder Cram Down 284

Altgate

DECEMBER 16, 2010

@altgate Startups, Venture Capital & Everything In Between Skip to content Home Furqan Nazeeri (fn@altgate.com) ← Pre-Money Valuation vs Number of Founders Where Do Tech VCs Invest? But first, let’s look at pre-money valuation by liquidation preference.

Liquidation Preference 39

Liquidation Preference Pre-Money Valuation Term Sheet Valuation 39

Lightspeed Venture Partners

OCTOBER 29, 2012

The company sought to raise $125,000 for 25% of the comapny, implying a $375,000 pre money valuation. Unsurprisingly, all the sharks passed, based on market size and valuation expectations. They did not have any meaningful proof of product-market fit. This is a very niche market.

Pre-Money Valuation 97

Pre-Money Valuation Offshore Valuation Cofounder 97

YoungUpstarts

SEPTEMBER 15, 2018

Startup valuation, under no circumstances, can be described as a simple affair. While valuing a publicly traded company is more or less straightforward, the case with a rarely profit making startup is not quite the same. Here are several factors that are taken into account while these startups are evaluated.

Pre-Money Valuation 124

Pre-Money Valuation Valuation Sweat Equity Startup 124

Both Sides of the Table

AUGUST 23, 2010

Answers OnStartups- Shortly after I started blogging I noticed a website called “ Answers on Startups ,&# which I instantly loved and spent a bunch of time on. It was this sort of techie / geeky looking UI implementation of questions that anybody could ask about startups. Tags: Tech Market Analysis. No, really.

Silicon Valley 301

Silicon Valley Pre-Money Valuation Technical Review Software Review 301

Austin Startup

JUNE 21, 2018

Our pre-money valuation for the seed round is 2 trillion dollars.” Transaction costs, while not always monetary, affect our willingness to buy, sell, and engage in a market. For example, bitcoin makes it possible to transfer money between parties without fees, or oversight from your bank, government, etc.

Securities and Exchange Commission 61

Securities and Exchange Commission SEC Pre-Money Valuation Security 61

Both Sides of the Table

JUNE 22, 2011

They have seen one side of a market where many of us have seen the ebb and flow multiple times. Still, market amnesia by ordinarily rational actors always surprises me. I believe a bubble occurs when a market is willing to pay greater than intrinsic value for an asset class. I spoke about a lot of things during the keynote.

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

Startup Professionals Musings

SEPTEMBER 6, 2010

The founders now need a $1M Angel investment to do the marketing for a national NewCo rollout, build a team to manage blogs and other resources, and maybe even pay themselves a salary. How much is NewCo worth to investors at this point (pre-money valuation)? All principals and employees add value.

Valuation 234

Valuation Pre-Money Valuation NPV Startup 234

Gust

NOVEMBER 18, 2012

The founders now need a $1M Angel investment to do the marketing for a national NewCo rollout, build a team to manage the rollout, and maybe even pay themselves a salary. How much is NewCo worth to investors at this point (pre-money valuation)? Look at the size of the market, and the growth projections for your sector.

Valuation 187

Valuation Pre-Money Valuation NPV Intellectual Property 187

View from Seed

OCTOBER 21, 2014

As the seed-stage startup fundraise process has received more transparency in recent years, ranging from published advice on how to raise seed capital to increased availability through AngelList, Funders Club, and various accelerator programs, I’ve noticed another trend emerging. Lower-Than-Market Value. Market Value.

Valuation 336

Valuation Founder Seed Stage Angel Investor 336

David Teten

SEPTEMBER 16, 2014

In 2013, 298,800 angels invested in 70,730 entrepreneurial ventures, according to the 2013 Angel Market Analysis by the Center for Venture Research at the University of New Hampshire. Source: Center for Venture Research – Angel Market Analysis Report. These companies can range from tech startups to food trucks to retail stores.

Angel Investor 114

Angel Investor Technical Review Venture Capital Pre-Money Valuation 114

Lightspeed Venture Partners

SEPTEMBER 21, 2013

Josh Brooks, who ran marketing for MySpace for three years, is the founder of a company that lets users take photos form their phones, and then use those photos to send postcards in the real world to their friends and family. pre money valuation and planned to use the money to market the app.

Pre-Money Valuation 167

Pre-Money Valuation Valuation Dilution Distribution 167

Startup Professionals Musings

MARCH 18, 2016

As an entrepreneur looking for professional investors, one of the quickest ways to lose credibility and get rejected is to start with a ridiculously high pre-money valuation. It’s like trying to sell a home still being built at next year’s dream market price. First priority is real revenue, customers and contracts.

Intellectual Property 120

Intellectual Property Valuation Pre-Money Valuation Startup 120

Startup Professionals Musings

SEPTEMBER 30, 2011

The founders now need a $1M Angel investment to do the marketing for a national NewCo rollout, build a team to manage the rollout, and maybe even pay themselves a salary. How much is NewCo worth to investors at this point (pre-money valuation)? Look at the size of the market, and the growth projections for your sector.

Pre-Money Valuation 246

Pre-Money Valuation Valuation NPV Intellectual Property 246

Gust

JULY 23, 2014

You’ll need to have invested significant cash (whatever that term means to you) in your own company, and you’ll need to have the core of your team in place (typically a techie and a marketer, at a minimum.) Invested Interests Power Pitches angel investor business David Rose entrepreneur meeting pitch startup'

Angel Investor 153

Angel Investor Elevator Pitch Pre-Money Valuation Technical Review 153

SoCal CTO

FEBRUARY 2, 2011

Bill Payne is an expert on how early-stage investors should look at valuation. He just post: Establishing the Pre-money Valuation of Pre-revenue Startups. Especially interesting is the Valuation Worksheet towards the end. Size of target market $100M is okay. It's required reading. Not sure why.

Valuation 198

Valuation Revenue Pre-Money Valuation Early Stage 198

View from Seed

SEPTEMBER 14, 2021

Will Quist did a great job of explaining this market rhetoric in this thread. The three-question framework goes as such: Q: How much tech-related market cap will be created in the next 10-20 years? So, on one hand, the market see ms like a total frenzy these days. However, I am not sure that is the case with VC. of the Nasdaq.

Valuation 319

Valuation Pre-Money Valuation Distribution Early Stage 319

View from Seed

SEPTEMBER 14, 2021

Will Quist did a great job of explaining this market rhetoric in this thread. The three-question framework goes as such: Q: How much tech-related market cap will be created in the next 10-20 years? So, on one hand, the market see ms like a total frenzy these days. However, I am not sure that is the case with VC. of the Nasdaq.

Valuation 295

Valuation Pre-Money Valuation Distribution Early Stage 295

The Startup Magazine

SEPTEMBER 12, 2019

Most startups view venture capital funding as a blessing from above — eager to take it as soon as they can get it. Tempted by large sums of money and the perceived validation that comes along with being funded, founders turn to venture capitalists to accelerate their company’s growth. This is often the case when it comes to VC funding.

Early Stage 98

Early Stage Venture Capital Bootstrapping Pre-Money Valuation 98

Tim Keane

JANUARY 12, 2010

Startups and angels: Along the way to success. Bottom Up Market Sizing » January 12, 2010. Term-sheets and Valuations: Thinking about Negotiations.   Most often, investors who are interested in a company raise this issue first to measure the company’s response to a market value offer. times at 5 years and 11.39

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Agile VC

MAY 26, 2011

AGILEVC My idle thoughts on tech startups. The market size for online advertising, e-commerce, and web premium services are 1/10th to 1/3rd the size they are today. To give you a sense, for 2002 the entire US online ad market was $6B and had shrunk year over year (it was $25B+ for 2010). How to Evaluate Firms for a Seed VC.

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

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. Photo by lco.

Valuation 119

Valuation Silicon Valley Pre-Money Valuation Bootstrapping 119

YoungUpstarts

SEPTEMBER 4, 2017

Investing in startups is a lot more than just buying “stock” in a company. For investors who have come to the table with a history investing in publicly listed companies or the property market, it’s easy to think that backing startups is largely a “set and forget” strategy. In addition to that very few startups only raise once.

Pre-Money Valuation 187

Pre-Money Valuation Seed Stage IP Deal Flow 187

The Startup Lawyer

FEBRUARY 4, 2011

Great news — your startup just got accepted to an incubator! But before your startup signs up and cashes that $[XX,000] check, your startup’s co-founders should sit down and evaluate the incubator’s offer. Pre-money valuations startups receive from incubators are typically low…really low.

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

Both Sides of the Table

JULY 27, 2014

We both are concerned about non-traditional capital entering the late stages and the impact that may have in the next downturn in the economy to the startups who merely trying to optimize for short-term valuation maximization. Four years ago people paid $66m median pre-money valuation and are now paying $155m.

Valuation 309

Valuation Pre-Money Valuation Later Stage Non-Compete 309

Both Sides of the Table

FEBRUARY 17, 2011

I’m a very big believer in the “Lean Startup&# principles as espoused by Steve Blank and Eric Ries. For many businesses you should keep your costs low & your capital raises low until you discover whether you are really on to a big idea where there is market demand. 25% dilution).

Pre-Money Valuation 303

Pre-Money Valuation Dilution Valuation PR 303

ithacaVC

OCTOBER 16, 2012

I hosted a guest lecturer today named Doug Rowan at Johnson (for those of you not in the Cornell ecosystem, “Johnson” is how the marketing department likes us to refer to Cornell’s business school). Doug is an older guy with lots of startup experience both as entrepreneur and investor. Period, the end.

Valuation 58

Valuation Pre-Money Valuation Startup Equity 58

View from Seed

SEPTEMBER 14, 2021

Will Quist did a great job of explaining this market rhetoric in this thread. The three-question framework goes as such: Q: How much tech-related market cap will be created in the next 10-20 years? So, on one hand, the market see ms like a total frenzy these days. However, I am not sure that is the case with VC. of the Nasdaq.

Valuation 156

Valuation Pre-Money Valuation Distribution Early Stage 156

Gust

SEPTEMBER 27, 2014

In order to be competitive, a company needs to have just about everything in place, from its product to its team to market traction, before it is ready to seek funding. Browse through the many hundreds of video answers to startup questions that we’ve filmed from the world’s leading VCs and angels.

Angel Groups 159

Angel Groups Elevator Pitch Software Review Deal Flow 159

Lightspeed Venture Partners

OCTOBER 7, 2012

This isn’t a company yet, it’s an idea, and the founder could do a lot more on his own to validate product-market fit before raising capital. As Cuban pointed out, this is a “down round” Zomm is seeking $2M for 10% of the company, implying an $18M pre money valuation today.

Technical Review 110

Technical Review Technical Cofounder Valuation Pre-Money Valuation 110