Tim Keane
JANUARY 12, 2010
Term-sheets and Valuations: Thinking about Negotiations. I’ve sat down with entrepreneurs and a copy of a term sheet guide I like [ “Term Sheets & Valuations - A Line by Line Look at the Intricacies of Venture Capital Term Sheets & Valuations ” by Alex Wilmerding, Aspatore Press.] The Valuation Question.
Steve Blank
APRIL 26, 2022
At the turn of the century after the dotcom crash, startup valuations plummeted, burn rates were unsustainable, and startups were quickly running out of cash. For existing investors, sometimes it was a “pay-to-play” i.e. if you don’t participate in the new financing you lose. This article previously appeared in TechCrunch.
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Both Sides of the Table
SEPTEMBER 29, 2009
They should heed the age old advice that raising slightly more money while you can is always better than trying to optimize future valuations. Should VC’s really be impacted by public market valuations when the money that they’re investing today should be for returns in 7-10 years? Short answer – yes.
Hunter Walker
AUGUST 8, 2023
At the time, this is last quarter and the stock market has trended upwards nicely since then (a potential leading indicator of private tech valuations), we all agreed venture portfolios were probably still 25-40% overvalued. Valuations. Restructures, Down Rounds, and Pay to Plays.
Both Sides of the Table
APRIL 21, 2020
A seed deal hasn’t already been “priced up” to a range where a new investor might be concerned about the valuation relative to performance. Optimize for a 1 not a 0 more than exact valuations now. Valuations may have changed and “price discovery” in private markets is harder to determine. Raise when you can.
Feld Thoughts
FEBRUARY 9, 2016
I’ve seen every imaginable type of liquidation preference structure, pay-to-play dynamic, preferred return, ratchet, share/option bonus, option repricing, and carveout. But, as you raise more money at higher valuations, this will normalize. Then, if you end up doing a down round, it suddenly matters a lot.
Both Sides of the Table
SEPTEMBER 15, 2010
But knowing the right people and knowing a market only works well for angel investors in bullish tech markets in which IPO’s happen quickly (97-99) or where larger companies are actively scooping up little tiny companies at sub $50 million valuations to drive innovation (05-08, 10-?). So where are we now? It’s hard to say.
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