Remove Entrepreneur Remove Finance Remove Pre-Money Valuation Remove Product
article thumbnail

Why Raising Too Much Money Can Harm Your Startup

Both Sides of the Table

So the temptation would be to ask for $5 million because that implies a $20 million pre-money valuation if you’re able to only give away 20% or a $15 million pre-money valuation of investors require 25%. A $15–20 million valuation sounds better than an $8 million valuation, doesn’t it?

article thumbnail

The Changing Venture Landscape

Both Sides of the Table

And the loosening of federal monetary policies, particularly in the US, has pushed more dollars into the venture ecosystems at every stage of financing. What Has Changed in Financing? And the truth is that several entrepreneurs prefer it this way. even before the pandemic itself has been fully tamed. Of course we can’t.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

Why Startups Should Raise Money at the Top End of Normal

Both Sides of the Table

I wrote this because over the last decade I’ve seen a destructive cycle where otherwise interesting companies have been screwed by raising too much money at too high of prices and gotten caught in a trap when the markets correct and they got ahead of themselves. Again, prices are expressed as pre-money valuations.

article thumbnail

On Bubbles … And Why We’ll Be Just Fine

Both Sides of the Table

This was an audience of mostly first-time entrepreneurs. It is great for entrepreneurs and great for VCs. So here is what I have been telling entrepreneurs privately for the past 6 months. What a bubble means for each entrepreneur. Still, market amnesia by ordinarily rational actors always surprises me. I believe that.

article thumbnail

How to Fund Your Startup Without Losing Control

Up and Running

Rule 1: Bootstrap until you have a viable product. Seeking that funding prior to launching a viable product, however, would have virtually ensured that Klemm would largely cede control of the company to PE investors. Takeaway lesson: A shocking number of technology startups never even get their first product out the door.

article thumbnail

Strategy Roundtable: Try To Get At Least $2M Pre-Money In Seed Round Valuation

ReadWriteStart

Before I do, however, I want to talk about a thumb rule that I'd like to propose to entrepreneurs about raising money. So at any point, if you are trying to raise money, and you are hearing from investors that you are too early and have too little validation, it may be a good thing. Value Of Insight Consulting, Inc.

Valuation 119
article thumbnail

10 Rules of Thumb for Startup Investment Valuation

Startup Professionals Musings

Once you have a potential investor excited about your team, your product, and your company, the investor will inevitably ask “What is your company’s valuation?” Many entrepreneurs stumble at this point, losing the deal or most of their ownership, by having no answer, saying “make me an offer,” or quoting an exorbitant number.

Valuation 270