valuation Archives - The 411 On Startups (tm)

What to Expect When You’re Expecting Venture Capital Returns

Jul

2015

One of the first things I did when I joined the venture asset class as a lowly institutional LP analyst in 2001 was to build the VC fund cashflow model. Just about every analyst who looks at fund investing has built one. You incorporate expected company returns, mortality rates, and fee structures to try to ...

Startup Financing Options: Friends and Family

Aug

2011

Many entrepreneurs turn to friends and family for their first funding needs. In fact, it is common for non-tech startups to raise all the capital they need from friends and family. I don’t know for sure, but I would suspect that friends and family make up the largest source of funding for entrepreneurs and startups. ...

Angel Capital Education: Ask an Angel: How Can Angels and Entrepreneurs Improve the Valuation Process?

Feb

2010

It has fallen upon angels to educate entrepreneurs about the realities of compressed valuations in today’s economy, especially since VCs are supporting very few up-rounds today. John Huston, founder of the Ohio TechAngel Funds in Columbus, talks about a successful and innovative approach to negotiating valuation with entrepreneurs.

Setting your company’s valuation | VentureBeat

Jul

2009

What’s the biggest mistake an entrepreneur can make? According to Jason Green, Founding Partner at Emergence Capital, it’s responding to the question about the valuation of their business. In this segment, taken from a 2007 Entrepreneur’s Summit hosted by Stanford University, Green discusses ways to turn the tables on investors who ask that question and ...

Startup valuations come back down to earth – BusinessWeek

Jan

2009

It’s no surprise that the value of tech startups is falling. With the deepening recession, even the stocks of highfliers such as Google (GOOG) and Apple (AAPL) have tumbled more than 50%. Still, this is a sharp reversal for a generation of companies that seemed poised to inherit the mantle of leadership in the tech ...

Term Sheets & Valuations – A Line by Line Look at the Intricacies of Venture Capital Term Sheets & Valuations (Bigwig Briefs): Alex Wilmerding

Dec

2008

Term Sheets & Valuations is the first ever in-depth look at the nuts and buts of terms sheets and valuations. The book, written by leading venture capitalist Alexander Wilmerding of Boston Capital Ventures, covers topics such What is a Term Sheet, How to Examine a Term Sheet, A Section-by-Section View of a Term Sheet, Valuations, ...

Term Sheets: Levers of valuation; Governance & Control; Preferred Stock Rights — Learnvc.com

Nov

2008

Here is a comprehensive guide to the components of a term sheet: * Pre-money valuation * Investment Size * Price per share * Option pool creation * Liquidation Preference * Dividends * Type of preferred stock: Convertible vs. Participating * Anti Dilution * Pay-to-Play * Founder Vesting * Closing Conditions * No Shop Clause Governance/Control ...

High Tech Startup Valuation Estimator

Oct

2008

(Note: the best way to use this valuation estimator is to answer the questions, see the valuation, and then change an answer or two to see the effect.)Wondering what your pre-money valuation will be if a VC ever puts a term sheet on the table? Valuing a startup is intrinsically different from valuing established companies. ...

Why a buy-sell agreement is important | The Startup Lawyer

Oct

2008

A buy-sell agreement is a document that preserves continuity of business ownership when specific events occur, such as death or disability of a business owner. It is a contract between shareholders or business partners concerning the future ownership of the business and can be drafted as part of the company’s shareholder agreement or as a ...

For Angels and Entrepreneurs — Valuation and Exit Ratios by Kelly Perdew

Oct

2008

Negotiating the valuation for a venture-where the valuation is based on the percentage of the venture’s equity that an investor receives for some amount of capital-may be the most important and the most misunderstood element in seed, startup, and early-stage investing. Important because valuation directly impacts both the percent of the venture that the entrepreneur ...