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Valuations 101: Scorecard Valuation Methodology


These angel investors generally invest $25,000 to $100,000 in a round totaling $250,000 to $1,000,000.  In 2011, the valuation of pre-revenue, start-up companies is typically in the range of $1.5–$2.5 Scorecard Valuation Methodology. As can be seen the average (mean) pre-money valuation for recent pre-revenue deals is $2.1

5 Reasons Startups Need Revenue As Well As Users

Startup Professionals Musings

Some analysts argue that revenue drives growth, while others say user growth drives revenue. Both have worked. Martin Zwilling.

10 Rules of Thumb for Startup Investment Valuation


How much is NewCo worth to investors at this point (pre-money valuation)? NewCo might be able to pick up an initial $50K valuation on this item.

Non Recurring Revenue Businesses

Rob Go

I’ve been thinking a little about non-recurring revenue businesses. Non-recurring revenue businesses might consume less cash to grow.

Startup Valuation: How Much Is Your Company Worth?

Seed Stage Capital

skip to main | skip to sidebar 19 January 2010 Startup Valuation: How Much Is Your Company Worth? They dazzle. It is analogous to a make-vs.-buy

How Investors Think About Valuation of Pre-Revenue Startups


Because of this, I've always tried to stay up-to-speed on how early-stage investors look at valuation of companies. 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. What are they really looking for? is a requirement.

Recurring Revenue is Magic

Seeing Both Sides

This allowed our revenue to skyrocket from $1.8 But the downside to our business model was that we did not have hardly any recurring revenue.  .

2012 Valuation Survey of Angel Groups


This summer I conducted our third annual survey of the pre-money valuation of pre-revenue companies recently funded by angel groups in North America.  Access to our 2010 and 2011 surveys can be found at 2011 Valuation Survey of North American Angel Investor Groups. Pre-revenue life Science, biotech and medical device deals.

What Startups Need To Know About Business Valuation


This is where a qualified business valuation professional comes in – he or she can determine the fair market value of the underlying stock.

A Bubble for Seed Stage Valuation

Angel Investing News

When entrepreneurs raise equity capital for startup companies, the investors’ percentage of ownership is determined by the negotiated valuation for the company at the time of investment.  For example, if the negotiated pre-money valuation is $1.5 But, as Mark Suster points out, the valuation of startup ventures also varies with demand. 

How we determine valuations for marketplaces

Version One Ventures

I often get asked about how to determine the valuation for a marketplace startup that is starting to scale. YoY growth of at least 30%.

Demystifying Small Business Valuation

Fresh Inc.: The Staff Blog

A successful small business sale begins with a solid grasp of business valuation. Period.

2011 Valuation Survey of North American Angel Groups

Angel Investing News

During the summer of 2010, I developed a workshop, A New ACEF Valuation Workshop for Angels and Entrepreneurs.  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.  Valuation. Location.

8 things to consider when determining your startup valuation

The Next Web

Setting a valuation for an early-stage startup looking to raise money is tough. In regards to your market? Young Entrepreneur Council

Valuation Methods 101


This is the first of a six part series on different methods used by angel investors to arrive at pre-money startup valuations.  Return on Investment (ROI) = Terminal (or Harvest) Value ÷ Post-money Valuation. (in the case of one investment round, no subsequent investment and therefore no dilution). The Cayenne Valuation Calculator.

How To Compute The Valuation of Your Startup

FairSoftware's Blog

Startup valuation is a misunderstood and complex topic. How fast has your revenue been growing so far? What about the dotted line?

Snapchat and that old no revenues debate

Fred Destin

Grown-up warnings about how real businesses have real revenues were yet again littering my twitter feed in recent weeks. Humongous scale.

Revenue exceptionalism vs margin exceptionalism

Chris Dixon

Three years ago, Fred Wilson wrote a great blog post called  When Talking About Business Models, Remember that Profits Equal Revenues Minus Costs. Most recent successful tech companies seem to have chosen the former: growing revenues at the expense of margins. Fast revenue growth seems to be the best way to justify your valuation.

2011 Valuation Survey of North American Angel Groups


During the summer of 2010, I developed a workshop,  A New ACEF Valuation Workshop for Angels and Entrepreneurs.  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.  Valuation. Location.

A Five-Minute Tutorial On How To Value Your Startup

Startup Professionals Musings

Equally bad is professing no valuation estimate at all, asking investors to “make me an offer.” reveneue Shark Tank startup valuation

Startups With Real Revenue Can Get Venture Capital

Startup Professionals Musings

Your friends and family are really the only answer until you have a significant revenue stream. Overall, investors put $7.5 startups.

Why Facebook Clearly Belongs in the 10X Revenue Club

Attached are my thoughts on the Facebook S-1 along with some quick stabs at valuation. Brief disclosure, Benchmark Capital has a minority position in Facebook as a result of the acquisition of FriendFeed, a company that was incubated in our offices. thought it would be useful to look at Facebook using the scorecard from our [.].

Startup Valuations – Again….


I have written about startup valuations previously. If you are advising startup founders, I strongly suggest having them read all 4 of the posts to get the lay of the startup valuation land. There’s a reason it’s so difficult to figure out – valuations have little basis in reality for early stage companies. Revenue.

Revenue benchmark for Series A – $1m run-rate and 20% MoM growth

The Equity Kicker

the ecommerce companies or software companies that we invest in) and you have a $1m revenue run rate and 20%+ month-on month growth you will generally be in good shape. Companies with greater revenues and stronger growth are able to raise bigger rounds at higher valuations. For Forward Partners that means an exit of £100m+.

After 20 years: Updating the Berkus Method of valuation


million), but certainly also allowing the investor to put much lower values into each test, resulting in valuations well below that amount.

Can Twitter Justify Its $11 Billion Valuation?

Fresh Inc.: The Staff Blog

It does have fast-growing revenue: According to its filings with the U.S. Nearly 90 percent of that revenue came from advertising.

The Trap of Relative Value

Feld Thoughts

He’d gotten a random note asking about his valuation when we invested relative to another financing that was just announced. The other company, which was much smaller at the point of investment, got an 11x ARR valuation. My response to the specific situation was: Valuations have increased on a relative basis.

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Join The Unicorn Club Of Billion-Dollar Companies

Startup Professionals Musings

If your new venture is still in the idea or development stages, don’t even think about a high valuation. These are popularly called “unicorns.”

Deals Gone WIld (aka "What Drives Massive Startup Valuations?")

Seed Stage Capital

You can view that post (and the valuation table) here. What drives the sky-high valuations and manias we occasionally see around a deal?

How Technology Impacts Small Business Valuations and Sale Prices

Fresh Inc.: The Staff Blog

Beyond revenues and profits, small businesses' IT aptitude will start playing a larger role in building value and attracting buyers

The Profit Imperative

Seth Levine's VC Adventure

Valuations are Down. In the public markets public SaaS valuations (EV/Revenue) are down 33% since January and 66% since their high in January 2014. Venture Economics bubble bubble bursting current market conditions startup valuations valuationsGrowing Profitably. ”). But they do, and they are right now.

Investors Beware: Today’s $100M+ Late-stage Private Rounds Are Very Different from an IPO

An unprecedented 80 private companies have raised financings at valuations over $1B in the last few years. Consider the case of

IPO 62

Dharmesh Shah – Valuation, Competition, Porter’s Five Forces and Culture

Business of Software Blog

Valuation. Valuation vs. Value. Valuation: What someone is willing to pay for the company at a given time. Your Company. Scale.

Box: Strong on Revenues (Weak on Profits) Files IPO

Fresh Inc.: The Staff Blog

The cloud-storage company has strong revenue growth, but no profits. Box''s revenue growth, however, has been strong. In 2013, Inc.

Worked Up about Unrealistic Venture Capital Valuation

Growthink Blog

So, Mike tells me he wants to raise a first round of venture capital based on a $100 million valuation. Getting a $100 Million valuation is impossible for a startup. In fact, getting above a $10 Million valuation is also virtually impossible unless you have at least some traction (e.g., Maybe you have $1 million in revenues.

NDA 14

Facebook, Twitter, & startup valuations - The best properties always look too expensive

Don Dodge on The Next Big Thing

The experts thought Microsoft was crazy when they invested $240M in Facebook at a $15B valuation. Digital Sky Technologies invested $200M in Facebook in May of 2010 at a $10B valuation. Just 7 months later Goldman Sachs is investing $500M at a $50B valuation. Market valuations are asymmetric. Crazy like a fox.

Convertible Debt: Worst Form Of Seed Financing — Except For All The Others


How to finance a new seed-stage startup? Equity? Convertible debt? Convertible equity? How can this possibly make sense?

Valuations 101: The Dave Berkus Method


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. Add to Pre-money Valuation. Note that the numbers are the maximum for each class (not absolutes) so a valuation can be $800K (or less) as easily as $2.5

Don't Flub Your Billion Dollar Valuation

Fresh Inc.: The Staff Blog

Recent valuations driven by a red-hot venture capital investment scene are eye-popping, but you need to justify your value. That in turn often drives those companies'' valuations into the billion-dollar stratosphere. Nearly forty companies have received billion-dollar valuations in the past couple of years.

Hugh opportunities do NOT command amazing pre-money valuations.


Dave’s note: Popular Bill Payne returns this week with a thoughtful take on valuations. By Bill Payne. million. Ignition!