Gust

NOVEMBER 2, 2011

We recently started a series of posts on establishing the pre-money valuation of pre-revenue startup companies for purposes of investment by seed and startup investors. He has invested in more than 70 startup ventures. Add to Pre-money Valuation. Characteristic.

Valuation 79

Valuation Pre-Money Valuation Intellectual Property Southern California 79

Up and Running

SEPTEMBER 19, 2017

Capital investments are like gasoline on a startup business’s metaphorical fire. If you’re like most startup CEOs, your startup has been your personal fiefdom and baby. By contrast, obtaining a pre-money valuation of $5 million for a business with a new viable product and even very minimal sales is somewhat reasonable.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

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. 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

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. It's required reading.

Valuation 198

Valuation Revenue Pre-Money Valuation Early Stage 198

Both Sides of the Table

APRIL 14, 2010

If you want to raise venture capital more easily the advice could be quite practical and counter-intuitive. Many companies that are raising B or C venture capital rounds right now raised their initial money in 2005-2008. That means that they likely raised money at a particularly high price relative to 2010 prices.

Venture Capital 289

Venture Capital Liquidation Preference Common Stock Dividend 289

Both Sides of the Table

JUNE 22, 2011

Ah, but today’s Internet companies have real revenue! 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. It’s what I love about entrepreneurship and about venture capital. and profits!

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

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. First priority is real revenue, customers and contracts. Future revenue projections are not relevant at the pre-revenue stage.

Intellectual Property 120

Intellectual Property Valuation Pre-Money Valuation Startup 120

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. Craft Your Company Culture.

Early Stage 85

Early Stage Venture Capital Bootstrapping Pre-Money Valuation 85

Tim Keane

JANUARY 12, 2010

Startups and angels: Along the way to success. Term-sheets and Valuations: Thinking about Negotiations. 3]   However, if they are built bottom up, they demonstrate and make explicit a range of business model assumptions the entrepreneur is using to think about his business and its revenue model. stake in the company.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Gust

OCTOBER 12, 2011

To provide some reference points, I surveyed thirteen angels groups in North American to determine their recent experience in negotiating the pre-money valuation of pre-revenue companies. See the 2010 data reported here: Current Pre-money Valuations of Pre-revenue Companies.

Angel Groups 125

Angel Groups Valuation Pre-Money Valuation St. Louis 125

VC Cafe

SEPTEMBER 26, 2022

The past year was a wild ride for startups and founders, giving a whole new meaning to the ”rollercoaster” aspect of being an entrepreneur. A combination of competition for top talent and an effort to bring employees back to the office drove startups in Israel to throw extravagant parties and all-inclusive retreats abroad.

Founder 187

Founder Startup Valuation Pre-Money Valuation 187

Gust

OCTOBER 20, 2011

Individual accredited investors in typical angel deals put personal capital at risk for an equity share of growth-oriented, start-up companies. In 2011, the valuation of pre-revenue, start-up companies is typically in the range of $1.5–$2.5 The range of the data is from a low pre-money valuation of $0.8

Valuation 146

Valuation Pre-Money Valuation Intellectual Property Technical Review 146

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

Gust

OCTOBER 12, 2011

That is obviously a challenge for the typical cash-strapped early stage startup that is seeking to raise more capital and is not in any kind of position to be repaying loans. Thus, it’s in everyone’s best interest to see the startup raise more capital rather than declaring default and demanding repayment.

Finance 107

Finance Term Sheet Pre-Money Valuation Early Stage 107

Both Sides of the Table

FEBRUARY 25, 2010

million at a $15 million pre-money valuation. We had people hearing through the grapevine that we were about to raise money and new investors started calling us to get in on the deal. Many companies that were in the process of raising money did not. It quickly became impossible to raise venture capital.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

www.paulgraham.com

OCTOBER 23, 2010

Want to start a startup? You need three things to create a successful startup: to start withgood people, to make something customers actually want, and to spendas little money as possible. Most startups that fail do it becausethey fail at one of these. Most startups that fail do it becausethey fail at one of these.

Startup 105

Startup Cofounder Software Stock 105

www.paulgraham.com

APRIL 28, 2010

Want to start a startup? November 2005 Venture funding works like gears. A typical startup goes throughseveral rounds of funding, and at each round you want to take justenough money to reach the speed where you can shift into the nextgear. Few startups get it quite right. Apply for funding by March 3.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

dondodge.typepad.com

JANUARY 15, 2011

So they will give you a pre-money valuation somewhere around the amount you raise. from David Dalka - Creating Revenue and Retention - Chicago GSB MBA As discussed in my recent post about a TiE event on Chicago start ups, there are many factors to consider when taking in funding and employees. it Founder conundrum.

Equity 40

Equity Employee Dilution Valuation 40

www.currentlyobsessed.com

MAY 28, 2010

Snapvine was my first experience being in the driver’s seat of the fund-raising process, and in the 3 years prior to our acquisition we raised over $10mm in venture capital. Valuation is an important aspect of VC deal terms, and a major determinant of your ultimate outcome. their requested capital and a further 1.8

Valuation 42

Valuation Channel Pre-Money Valuation Term Sheet 42