Feld Thoughts

JULY 9, 2019

This was before the IPO Summer of 2019 when all conventional valuation metrics have entered the land of “suspension of disbelief” which is short-term good and long-term well-we-will-see-…-eventually. We ended up talking about using Gross Profit, instead of Revenue, to do valuation analysis. Isn’t accounting fun?

Revenue 179

Revenue Valuation .Net IPO 179

Feld Thoughts

SEPTEMBER 27, 2011

In this case, the convertible debt document doesn’t allow the debt to convert into anything, but at the same time mandates that upon a sale the debt must be paid off. If there is no specific language addressing this situation, this is what usually ends up happening. So the lenders don’t see any of the upside on the acquisition.

Conversion 96

Conversion Sales Later Stage Preferred Stock 96

Feld Thoughts

OCTOBER 30, 2014

In it, he talks about how he handles public company stocks that he ends up with either via an IPO or a sale of a company he’s involved in to a public company. He’d gotten a random note asking about his valuation when we invested relative to another financing that was just announced.

Valuation 143

Valuation Stock Angel Investor IPO 143

Feld Thoughts

JUNE 27, 2013

For example, see his post today on Valuation vs. Ownership. I’m going to hang out in the comments on Fred’s Valuation vs. Ownership post and Jason’s The “VC Bargain” post today. Venture Capital equity mendelson ownership sale valuation wilson' Fred Wilson does this regularly.

Valuation 132

Valuation Venture Capital Equity Partner 132

Feld Thoughts

NOVEMBER 18, 2013

Convertible debt financings have become an increasingly attractive approach for seed rounds because it delays the valuation discussion, costs less from a legal standpoint, and is an easier financial instrument to “keep raising more small amounts of money” on. There is $350k left in the bank. Seven months in, there is a beta product.

Burn Rate 152

Burn Rate Equity Software Review Early Stage 152

Feld Thoughts

DECEMBER 10, 2014

The deals tend to fall into two categories – easy and immediate, which multiple bidders generating an rapidly escalating valuation or a long slow slog through lots of “almost there but we are passing because of some arbitrary reason.” enterprise software license sales) that is no longer trendy.

Later Stage 142

Later Stage Syndicate Syndication Portfolio 142

Feld Thoughts

FEBRUARY 9, 2016

I suffered through the next financing after implementing a complex structure, or a sale of the company, or a liquidation. This is a little tricky in early rounds and with modest up-round financings, as you’ll often have a liquidation preference that is high relative to your overall valuation.

Cap Table 70

Cap Table Down Round Liquidation Preference Founder 70