Both Sides of the Table

SEPTEMBER 29, 2009

The pricing problem – So an investor put $5 million at a $10 million pre-money valuation in a company with a great beta product but no real customers. The company was therefore priced at $15 million post-money and the VC (s) own 1/3 rd. It is no wonder why they had less time for new deals.

Burn Rate 263

Burn Rate Valuation Pre-Money Valuation Private Equity 263

Austin Startup

JUNE 21, 2018

Our pre-money valuation for the seed round is 2 trillion dollars.” By: Joe Merrill, Partner at Sputnik ATX. 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. It will revolutionize produce sales globally.

Securities and Exchange Commission 61

Securities and Exchange Commission SEC Pre-Money Valuation Security 61

Jason Ball

SEPTEMBER 28, 2010

Don’t sweat the valuation too much. If this is your first start up, you’re not going to get a great multi-million dollar pre-money valuation, nor a lot of cash up front. A series D round held in September 2009 raised $100 million from Insight Venture Partners, T. Via Technology Review.

Pre-Money Valuation 34

Pre-Money Valuation Valuation Dilution Venture Capital 34

David Teten

SEPTEMBER 16, 2014

Villalobos & Payne: “Startup Pre-Money Valuation: The Keystone to Return on Investment” 117. Based on his track record, by 2008 he was able to found ff Venture Capital , an institutional angel investment firm (where I am a Partner). approx 1999-07. 1961- 1996. Mason & Harrison: “Is it worth it?

Angel Investor 114

Angel Investor Technical Review Venture Capital Pre-Money Valuation 114

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

Agile VC

MAY 26, 2011

The terms and valuation for both offers were comparable and when the team debated which path to choose, we all agreed both firms would have made good partners. round which closed in November 2003, and the pre-money valuation between $10 million and $15 million. We three partners are working hard.

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

The Equity Kicker

APRIL 10, 2015

We’ve just been writing an update for investors about the progress our partner companies have been making. A few of them have done good up rounds and the easiest way to describe the magnitude is to talk about the valuation multiple.

Valuation 60

Valuation Pre-Money Valuation Post-Money Valuation Option Pool 60

View from Seed

OCTOBER 21, 2014

Using NextView as an example, since we both seek to lead the seed round and only lead during this round, I’ve seen this trend manifest in one of two ways: In a priced round, the entrepreneur will often share their valuation ask (or a stated floor) for the pre-money valuation of their company much sooner in the process.

Valuation 336

Valuation Founder Seed Stage Angel Investor 336

Both Sides of the Table

JULY 27, 2014

(not in video but late stage valuations have grown 24% compounded years for the past 4 years which is higher than any segment. Four years ago people paid $66m median pre-money valuation and are now paying $155m. This can’t all be driven by increased company performance). Either way it turned into a heated debate.

Valuation 309

Valuation Pre-Money Valuation Later Stage Non-Compete 309

Lightspeed Venture Partners

OCTOBER 22, 2012

As you may have already seen , I’ve been breaking down the pitches on this season’s Shark Tank while wearing my work hat as a Managing Director at Lightspeed Venture Partners. This implies a pre money valuation of $1.045M. See my breakdown of week 2 for more on how to calculate pre money valuation.).

Pre-Money Valuation 101

Pre-Money Valuation Valuation Dilution Differentiation 101

This is going to be BIG.

JULY 30, 2015

Do seed investors have Limited Partners with different return expectations than Series A and beyond investors? I'd say no--they're taking money from the same endowments, high net worths and pension funds as everyone else. I've never heard any limited partner ask me if I can generate a better return than their Series A funds.

Venture Capital 60

Venture Capital Pre-Money Valuation IRR Valuation 60

Both Sides of the Table

MAY 30, 2018

It was 20 months ago and the founder clearly told me she has made great process (code words for higher price expected) She is raising $5–7 million and knows the range of valuations for this amount. If I assume 20–25% dilution that implies a price of between $20–28 million pre-money valuation ($25-$35m post-money).

Valuation 324

Valuation Post-Money Valuation Pre-Money Valuation Cofounder 324

The Startup Magazine

SEPTEMBER 12, 2019

Over the long term, this results in numerous partners with different expectations on returns and performance. Your venture capital partners will, of course, have your company’s best financial interests at heart. Typical startups take in multiple rounds of funding from multiple investors. It certainly was for us.

Early Stage 85

Early Stage Venture Capital Bootstrapping Pre-Money Valuation 85

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

Both Sides of the Table

FEBRUARY 4, 2016

Limited Partners (LPs) who invest in VC funds have continued to pour money into venture – with the market returning to pre-recession levels. The result of all of this new money? [note: to follow realtime conversations & engage with me on Facebook you can follow me here: https://www.facebook.com/msuster ].

LP 150

LP Valuation Burn Rate Pre-Money Valuation 150

Gust

OCTOBER 20, 2011

This method compares the target company to typical angel-funded startup ventures and adjusts the average valuation of recently funded companies in the region to establish a pre-money valuation of the target. In most regions, the pre-money valuation does not vary significantly from one business sector to another.

Valuation 146

Valuation Pre-Money Valuation Intellectual Property Technical Review 146

Early Growth Financial Services

JUNE 26, 2014

Baze, Partner at Partech Ventures, Carlos Diaz, CEO at Kwarter, and EGFS’ Chief Strategy Officer Glenn McCrae covered raising funds, how-to pitch VCs, and potential sticking points around valuation. 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

Genuine VC

JULY 30, 2012

By communicating pricing expectations with potential lead investors, I mean sharing either an “ask” or even stated floor for the pre-money valuation of the company (with a priced preferred round) or explicitly stating a valuation cap (for convertible note round).

Valuation 136

Valuation Pre-Money Valuation Angel Investor Syndicate 136

Berkonomics

SEPTEMBER 27, 2018

I’ve been offered $15 million for my company and my partner is suing me for all I am worth. And yes, his partner had a valid suit, having been locked out of the web-design business and denied access to decisions and accounting information. What can I do?”. The fabulous contradiction – and opportunity. My immediate reaction and offer.

Pre-Money Valuation 48

Pre-Money Valuation Sales Liquidity Event Valuation 48

Professor VC

JANUARY 17, 2008

A partner from the law firm (sponsor, covers the drinks and food) tosses out some softball questions to the panelists, the audience chimes in with Q&A and finally, culminates with the meet and greet where the panelists are flooded with business cards and pitches on the next great thing, which is often very similar to the last great thing.

Pre-Money Valuation 28

Pre-Money Valuation Angel Investor Angel Groups Valuation 28

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

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

Rob Go

AUGUST 29, 2016

When I first started out as a VC nearly 9 years ago, most early stage company valuations were expressed as pre-money valuations. That is, the valuation of the company prior to the investment of new capital. The post Quick Post on Post-Money Valuations appeared first on ROBGO.ORG.

Post-Money Valuation 52

Post-Money Valuation Valuation Cap Table Term Sheet 52

Both Sides of the Table

APRIL 14, 2010

It’s frustrating because you did $4 million in revenue last year and have a $7 million run rate for this year and you’re struggling to get financed for even $5 million while other startups are out there with no revenue raising $10 million at a $40 million pre money valuation! But pass they will. Brain damage.

Venture Capital 289

Venture Capital Liquidation Preference Common Stock Dividend 289

Berkonomics

SEPTEMBER 17, 2011

I’ve been offered $15 million for my company and my partner is suing me for all I am worth. And yes, the partner had a valid suit, having been locked out of the business and denied access to decisions and accounting information. Within three months, we easily obtained $3 million of investment at a pre-money valuation of $30 million.

Liquidity Event 59

Liquidity Event Pre-Money Valuation Sales Valuation 59

K9 Ventures

MAY 14, 2011

The incubators invest usually for an equity stake and buy equity at a extremely low valuation (for example, 7% for $15,000, which implies a pre-money valuation of less than $200,000). They are still individual investors, they invest on a full-time basis as professionals, but they have funds with Limited Partners.

Preferred Stock 125

Preferred Stock Seed Stage Incubator Early Stage 125

Both Sides of the Table

FEBRUARY 25, 2010

We were trying to optimize around a few criteria: price, size of round, number of syndicate partners and, of course, terms. million at a $15 million pre-money valuation. You need your key negotiating partner and both sets of lawyers. Be willing to take breaks to let your partner call his senior people for consent.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

Pascal's View

AUGUST 21, 2011

Does the primary and secondary capital raising prowess of companies such as Facebook, Linked In, Pandora, Twitter, Groupon, Zynga, and others, mean that we have finally crossed the threshold and reached a sustainable new valuation paradigm (it’s different this time, really), or is this another accident now happening in real time?

Valuation 50

Valuation Social Media Media IPO 50

Seeing Both Sides

NOVEMBER 30, 2008

That's because the two key assumptions regarding how much money a portfolio company would require from start to finish (the exit) have changed: (1) the length of time before exit; and (2) the number of portfolio companies that would attract outside capital to lead follow-on financing rounds.

Pre-Money Valuation 20

Pre-Money Valuation Portfolio Post-Money Valuation Valuation 20

thestartuplawyer.com

FEBRUARY 24, 2010

Your Business Partner Closer,&# was a reformatted version of a blog post titled “Keep Your Startup Co-Founder Closer&# which appeared in Ryan Roberts PC’s blog for startups and entrepreneurs, The Startup [.] He obviously never launched a startup and got shafted by a co-founder.

Cofounder 40

Cofounder Founder Preferred Stock Startup 40

Both Sides of the Table

APRIL 3, 2010

As a reminder, VC funds are comprised of money from LP’s (Limited Partners) that include university endowments, pension funds, high-net-worth individuals, insurance companies and large corporations. A totally new VC is willing to invest in the company but at a $15 million pre-money valuation.

Pre-Money Valuation 226

Pre-Money Valuation Venture Capital LP Term Sheet 226

www.paulgraham.com

APRIL 28, 2010

The fund managers, who are called"general partners," get about 2% of the fund annually as a managementfee, plus about 20% of the funds gains. We funded Viaweb entirely with angel money; it neveroccurred to us that the backing of a well known VC firm would makeus seem more impressive. [ Dont be misled by thisoptimism.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

venturehacks.com

OCTOBER 21, 2010

If you don’t keep your eyes on the option pool while you’re negotiating valuation, your investors will have you playing (and losing) a game that we like to call: Option Pool Shuffle You have successfully negotiated a $2M investment on a $8M pre-money valuation by pitting the famous Blue Shirt Capital against Herd Mentality Management.

Option Pool 68

Option Pool Pre-Money Valuation Dilution Warrant 68

David Teten

NOVEMBER 15, 2013

Disruptable Pattern #4: Most investors put in only a modest amount of their own money into their funds. In the asset management industry, the norm is that the General Partner puts in 1-2% of the total assets under management. I have frequently heard the expression from other investors, “We can put a lot of money to work here.”

Management 114

Management Pre-Money Valuation Venture Capital New Hampshire 114

VC Cafe

JANUARY 20, 2014

Across all investment stages, median pre-money valuations last year rose dramatically. The bull market will celebrate its 5 th anniversary in March (NASDAQ grew 38.3% last year, more than any other major index), and the IPO market is booming. Now the cost of entry to the Party is rising. Seed-stage deals now require $5.1

Venture Capital 155

Venture Capital Pre-Money Valuation IPO 155

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. Great stuff.

Valuation 42

Valuation Channel Pre-Money Valuation Term Sheet 42

Rob Go

NOVEMBER 30, 2012

Partner Time. This means greater focus on ownership, pre-money valuations, and dollars in. In addition to our fund NextView, we often (or usually) see funds like First Round, Founder Collective, Softech, Floodgate, and others fighting for lead positions.

Seed Stage 55

Seed Stage Pre-Money Valuation Dilution Early Stage 55