The Startup Lawyer

FEBRUARY 4, 2011

The following are some issues to consider and actions to take before accepting an incubator’s offer: (1) Calculate Valuation and Determine Value. Pre-money valuations startups receive from incubators are typically low…really low. 6) Search For the Incubator’s PR and Marketing Efforts.

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

Agile VC

MAY 26, 2011

round which closed in November 2003, and the pre-money valuation between $10 million and $15 million. My partner @ LeeHower looks back: [link] 5 days ago Search. It was a $4.7M So from start to finish our fundraise took roughly four to five months. The rest, as they say, is history. Previous Entries.

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

Gust

SEPTEMBER 27, 2014

Rather than limiting your search to venture funds, therefore, consider the full range of startup options. While VCs are the toughest nut to crack, there are many other (often better) sources of seed capital that may be available to you.

Angel Groups 159

Angel Groups Elevator Pitch Software Review Deal Flow 159

View from Seed

OCTOBER 21, 2014

Using NextView as an example, since we both seek to lead the seed round and only lead during this round, I’ve seen this trend manifest in one of two ways: In a priced round, the entrepreneur will often share their valuation ask (or a stated floor) for the pre-money valuation of their company much sooner in the process.

Valuation 336

Valuation Founder Seed Stage Angel Investor 336

Tim Keane

JANUARY 12, 2010

An average of these ranges results in a pre-money valuation of about $4MM.   If similarly situated companies are seeing $3.5MM pre-money valuations, this might become the target valuation. An average of these ranges results in a pre-money valuation of about $4MM. April 2013.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Professor VC

JANUARY 17, 2008

It is several thousand dollars, which is a lot of cash for a struggling entrepreneur in search of seed funding. Just seems that the guys with the money shouldnt be charging the guys who dont have any.One of the other panelists mentioned that they dont charge the entrepreneurs, but do require them to spring for lunch at a follow-up meeting.

Pre-Money Valuation 28

Pre-Money Valuation Angel Investor Angel Groups Valuation 28

Genuine VC

JULY 30, 2012

By communicating pricing expectations with potential lead investors, I mean sharing either an “ask” or even stated floor for the pre-money valuation of the company (with a priced preferred round) or explicitly stating a valuation cap (for convertible note round).

Valuation 136

Valuation Pre-Money Valuation Angel Investor Syndicate 136

Berkonomics

NOVEMBER 4, 2016

Because the Internet has such a long memory and documents from the distant past can be found with ease, a search the “The Berkus Method” today will yield any number of conflicting valuation criteria and element amounts culled from the many subsequent publications of the method over the ensuing years.

Valuation 48

Valuation North Carolina Oklahoma City Silicon Valley 48

www.mattbartus.com

DECEMBER 9, 2012

Let’s say you receive a term sheet for a $1 million investment at a $3 million fully diluted pre-money valuation, and you’re kind of disappointed. Take a look at the numbers: Pre-Money. One possibility is to negotiate a higher valuation and offer warrants (i.e., Post-Money. Option Pool.

Warrant 40

Warrant Valuation Pre-Money Valuation Term Sheet 40

VC Cafe

SEPTEMBER 26, 2022

ValuatIon should be a function of value, not ego. Kawasaki’s Law of Pre-Money Valuation: for every full-time engineer, add $500,000; for every full-time M.B.A., Because the product and market can likely change in the search for product market fit. Our goals, their goals. subtract $250,000. Guy Kawasaki, author.

Founder 187

Founder Startup Valuation Pre-Money Valuation 187

Professor VC

FEBRUARY 12, 2015

It''s previous financing round was a little over a year prior to the IPO and was a $8M raise at a $60M pre-money valuation led by John Doerr of Kleiner Perkins. In 2008, I made an investment offer of $250K for approximately 38% of the company ($400,000 pre-money valuation). or a market cap of $800M.

Las Vegas 28

Las Vegas IPO Pre-Money Valuation Valuation 28

www.paulgraham.com

OCTOBER 23, 2010

Googles plan, for example, was simply to create a search site thatdidnt suck. They had three new ideas: index more of the Web, uselinks to rank search results, and have clean, simple web pages withunintrusive keyword-based ads. For example, dating sites currently suck far worse than search didbefore Google.

Startup 105

Startup Cofounder Software Stock 105

venturehacks.com

OCTOBER 21, 2010

If you don’t keep your eyes on the option pool while you’re negotiating valuation, your investors will have you playing (and losing) a game that we like to call: Option Pool Shuffle You have successfully negotiated a $2M investment on a $8M pre-money valuation by pitting the famous Blue Shirt Capital against Herd Mentality Management.

Option Pool 68

Option Pool Pre-Money Valuation Dilution Warrant 68

dondodge.typepad.com

JANUARY 15, 2011

So they will give you a pre-money valuation somewhere around the amount you raise. Sounds strange, but it usually works out that if you are raising $2M the VCs will value your company at $2M pre-money, and $4M post money so they end up with 50% of the stock. Having trouble reading this image?

Equity 40

Equity Employee Dilution Valuation 40

www.paulgraham.com

APRIL 28, 2010

Stage 2: Angel Round While writing the prototype, the group has been traversing theirnetwork of friends in search of angel investors. The angel agrees to invest at a pre-money valuation of $1 million.The company issues $200,000 worth of new shares to the angel; ifthere were 1000 shares before the deal, this means 200 additionalshares.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

www.paulgraham.com

APRIL 28, 2010

2 ] When you negotiate terms with a startup, there are two numbers youcare about: how much money youre putting in, and the valuation ofthe company. The valuation determines how much stock you get. Ifyou put $50,000 into a company at a pre-money valuation of $1million, then the post-money valuation is $1.05

Angel Investor 63

Angel Investor Syndicate Syndication Dilution 63