Valuation Part I: Peeling the Onion, or How Top Investors Value the Startups They Invest In


Early-stage technology company valuations are generally a crap-shoot. This post builds on top of his work, and attempts to shed additional light on the valuation process. How To Fundraise Starting Your Company valuation valuations


A VC : Venture Capital and Technology

I just listened to this podcast with Marc Andreessen, Chris Dixon, and Benedict Evans. And since the post I was going to write today is now delayed until tomorrow, I will simply run the podcast as my post of the day. Lot’s of great stuff in here. I particularly liked the bit (about 17.5

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Valuations 101: Scorecard Valuation Methodology


In 2011, the valuation of pre-revenue, start-up companies is typically in the range of $1.5–$2.5 Scorecard Valuation Methodology. This method compares the target company to typical angel-funded startup ventures and adjusts the average valuation of recently funded companies in the region to establish a pre-money valuation of the target. Pre-money valuation varies with the economy and with the competitive environment for startup ventures within a region.

Startup Valuation Tips


In order to attract investors, you have to know the valuation of your company or how much your company is worth. Many new business owners struggle with valuation because it isn’t as easy as crunching some numbers. Take a look at this infographic to learn more about valuation.

Tesla Lost $700 Million Last Year, So Why Is Tesla’s Valuation $60 Billion?

Steve Blank

What explains this more than 1,000 to 1 discrepancy in valuation? However, the question shouldn’t be why Tesla has such a high valuation. Automobile manufacturers shipped 88 million cars in 2016. Tesla shipped 76,000. Yet Wall Street values Tesla higher than any other U.S.

The Billion Dollar Valuation Club

A VC : Venture Capital and Technology

As David Hornik points out in the comments to Aileen's post, using private company valuations to do this excercise means you will count companies with inflated valuations that they won't be able to live up to. But I think it is OK to use private company valuations as long as you come back and revisit the list from time to time, add new names, and subtract the ones that did not live up to the hype.

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? One of the most common issues that concern entrepreneurs is how to address the "Valuation Question." How do we best approach the question of valuation?

When Should Startup Founders Discuss Valuation with Seed VCs?

View from Seed

Or, in the case of a convertible note, they’ll explicitly state a valuation cap. On the positive side for a founder, directly stating a high valuation expectation up front can anchor the negotiations to a higher level, assuming that an investor takes the leap of faith to invest.

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?” How much is NewCo worth to investors at this point (pre-money valuation)? valuation entrepreneur startup investor business

Valuation trickle down

The Equity Kicker

He used this chart as evidence: Second, I read Josh Kopelman’s/First Round Capital’s Open Letter to Investors from May this year which says that seed valuations are up 3x from 2007-2015 without a corresponding increase in exits. I’m back to the bubble question this morning.

Valuations 101: The Venture Capital 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. It is one of the useful methods for establishing the pre-money valuation of pre-revenue startup ventures. The concept is simply…since: Return on Investment (ROI) = Terminal (or Harvest) Value ÷ Post-money Valuation. (in Then: Post-money Valuation = Terminal Value ÷ Anticipated ROI.

Benefits Of Business Valuation


There are many reasons why you need a current valuation of your business and many business owners assume that it is only necessary when selling but actually, this is not the case. Business valuations and wealth management. Others business valuation company valuation selling a business

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. We asked each group for their median (middle) pre-money valuation of pre-revenue deals. 2012 Valuation Survey. pre-money valuation in US$ millions).

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 the valuation of the company increases. But, as Mark Suster points out, the valuation of startup ventures also varies with demand. Suster suggests we will see the valuation bubble burst within the next 24 months.

5 Ways To Radically Improve Your Company Valuation

YFS Magazine

For business owners, startup valuation is a topic that causes lots of angst, raises tons of questions and definitely gets emotions blazing. Finance Grow business valuation company valuation fundraising investors invse money raising capital raising startup capital raising venture capital

What Startups Need To Know About Business Valuation


With the daily demands of running a business along with the financial pressures and challenges inherent in early-stage companies, a business valuation may not be the first thing an entrepreneur thinks of when he awakes each morning. When does a startup company need a business valuation?

Quick Post on Post-Money Valuations

Rob Go

When I first started out as a VC nearly 9 years ago, most early stage company valuations were expressed as pre-money valuations. That is, the valuation of the company prior to the investment of new capital. The post Quick Post on Post-Money Valuations appeared first on ROBGO.ORG.

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. Our assumptions for this valuation: Scale: > $1b GMV. The post How we determine valuations for marketplaces appeared first on Version One.

What Are We Talking About When We Talk Valuation?

Early Growth Financial Services

Valuation is one of those ubiquitous words: at least when it comes to discussions around startups — and, of course, stock market multiples. In fact, there are several types of valuations and they come into play at different times in a company’s lifecycle. For example, there are the private company valuation figures that get bandied about: think the numbers people reference for Uber and AirBnB for example. And then there are 409A valuations.

Valuation vs. Ownership

David Lee

When I speak to most founders and investors about financings, we focus on valuation. And when we think of valuation, the other side of the coin is dilution. For any fixed invested amount, the higher the valuation, the lower the dilution. Investors and founders can get fixated on this tradeoff of valuation vs. dilution. valuation/dilution), it’s better to ask questions like, “for X% of the company, what is the investor going to do to justify that ownership?”

Wenger: A Rational Internet Venture Valuations Bubble

Ask The VC

It’s titled A Rational Internet Venture Valuations Bubble and is insightful, clever, and though provoking. VC Post of the Day bubble internet usv valuations wengerAs I sit here in Boulder watching MI-5, taking care of Amy , avoiding SXSW, and catching up on RSS and email, I came across a post from Albert Wenger (USV) that rang true. Easily the best VC post of the week.

Om Malik on why valuations defy metrics

The Equity Kicker

When companies attract high valuations their investors are predicting the future too – either that the business will trade in M&A at a ‘strategic multiple’ or that they will generate big cash flows. For larger valuations it is the latter.

Age of companies when they achieve $1bn valuations

The Equity Kicker

It seems to me there are two obvious explanations for the dramatic reduction in the time it takes for companies to achive $1bn valuations: The pace of change is increasing allowing new companies to develop and mature faster.

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. Detailed descriptions will be published over the next few weeks: The Scorecard Method: This method compares the target company to typical angel-funded startup ventures and adjusts the average valuation of recently funded companies in the region to establish a pre-money valuation of the target. The Cayenne Valuation Calculator.

I Built My Startup To A $15M Valuation – While Living In A Van

YFS Magazine

Over a course of two years, I bootstrapped a startup to a $15M valuation – while living in a van. After that experience my sense of reality was redefined. Editor Picks Lifestyle digital nomad lifestyle location independent personal development starting a business startup advice

What Are Your Valuation Expectations?

Rob Go

One question I know investors sometimes ask founders is “what are your valuation expectations for this round?” ” I try not to throw out hypothetical valuations unless I am actually making an offer to a company. The post What Are Your Valuation Expectations?

When Valuation Doesn’t Matter


Valuation is always important to founders. valuation. At that point, valuations explode. The post When Valuation Doesn’t Matter appeared first on StartupCFO : Mark MacLeod. Most of the time, the price an investor is willing to pay to invest in your company is a hotly debated topic. But for investors there are some rare times when it (almost) doesn’t matter. When Kleiner Perkins invested in Twitter in 2010, they were criticized for completely missing web 2.0

How Startup Valuation Works

Business Plan Blog

Startup Valuation is Tricky Business. A valuation is simply an estimated value of a company and is often based on assumptions surrounding the company’s current and future potential. How Startup Valuation Works.

Failsafe Ways to Increase Your Startup Valuation

Early Growth Financial Services

Ahh startup valuations. Why are valuations even important? Besides determining things such as the amount of equity you give up for funding and how much value you are able to extract from your company in the long-term, valuations are important for demonstrating how attractive your business is to investors and in showing how you compare with your industry peers. Below are some of the key takeaways: There are 3 main types of valuation: 1.

Demystifying Small Business Valuation

Inc Startups

A successful small business sale begins with a solid grasp of business valuation. Left unchecked, the valuation process can quickly devolve into a pricing routine that is rooted in personal attachments and other subjective inputs rather than solid data based on marketplace realities.

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. See the 2010 data reported here: Current Pre-money Valuations of Pre-revenue Companies. 2011 Angel Group Valuation Survey. Valuation.

Snapchat Seeks $22 Billion Valuation

Inc Startups

Snap Inc--Snapchat's parent company--will sell 200 million shares at $14-$16 each, according to SEC filings published Thursday morning

SEC 22

How To Compute The Valuation of Your Startup

FairSoftware's Blog

Startup valuation is a misunderstood and complex topic. But that’s not the right approach to understand how valuation works for your startup. It’s the #1 argument for a high valuation.

Want to Know How VC’s Calculate Valuation Differently from Founders?

Both Sides of the Table

Other founders, “as a privately held company we don’t disclose our valuation.&# Me, “dude, I’m not a journalist. I just want to figure out what a fair valuation is.&# I figured all the VC’s talked so we should.

Facebook gets to $250bn valuation in record time – respect

The Equity Kicker

Bloomberg and other sites are lauding Zuckerberg and co for beating current record holder Google’s eight years from IPO to $250bn valuation. Those with long memories will know that Facebook went public with a much larger valuation than Google ($104bn vs $23bn) so the more apt comparison is Facebook’s eleven years from founding to $250bn with Google’s fourteen years. Facebook’s share price was up 2.4%

Startup Valuations: 7 Things to Look for in a Valuation Company

Early Growth Financial Services

Valuation. What you may not know is that it really does matter who performs your valuation. There are a lot of valuation companies out there, so I know many entrepreneurs are tempted to just shop around until they find the lowest price, but this is a mistake. A valuation is more than just a commodity. All valuations are not created equally; there are better valuations, better processes, and better valuations business partners for your company.

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. See the 2010 data reported here: Current Pre-money Valuations of Pre-revenue Companies. 2011 Angel Group Valuation Survey. Pre-money Valuation of Pre-revenue Companies.

Startup Valuations – Again….


I have written about startup valuations previously. This morning I was reading one of my favorite daily compilations of articles (called Innovation Daily, subscribe here ) and came across another great short article on startup valuations called “ Seed Rounds: How to Pick a Valuation “ Joseph Walla, who I don’t know, wrote it. There’s a reason it’s so difficult to figure out – valuations have little basis in reality for early stage companies.

US startup valuations reach ten year highs

The Equity Kicker

Venturebeat reported yesterday that US startup valuations have reached ten year highs. You can see from the charts above that median valuations have been increasing at all stages from seed through to Series D or later.

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. Especially interesting is the Valuation Worksheet towards the end. A lot of my time is spent helping early-stage companies get to proof points so that they can raise capital.