valuation - 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. ...

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, ...

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 ...

What is preferred stock and why is it issued to investors? : Startup Company Lawyer

Oct

2008

(Note: read the comments on this blog page.) Preferred stock generally has rights senior to common stock. Startup companies typically issue common stock to founders (and options to purchase common stock to employees) and preferred stock to investors. One reason for issuing preferred stock to investors is to preserve the ability of a company to ...

Reasonable pre-money valuations for startups

Oct

2008

(Note: read the comments on this blog’s post since numbers change with the investment environment. The post does point to process though). The operable word, valuation, in the phrase ‘pre-money valuation’ is really a misnomer. Typical angel or venture capital investors aren’t really attempting to determine ‘value’, but instead they are attempting to determine ‘price’. ...

Sequoia Capital’s 56 Slide Presentation Of Doom

Oct

2008

Techcrunch was able to track down the presentation that Sequoia Capital gave to its portfolio company CEO’s earlier this week (and so did VentureBeat). It’s a long, 56 slide Powerpoint message of doom and gloom in Silicon Valley that Techcrunch covered recently along with an email that angel investor Ron Conway sent to his 130 ...

Angel Investor Ron Conway Emails His Portfolio Companies Over Financial Meltdown

Oct

2008

Ron Conway, one of Silicon Valley’s most prolific angel investors (and he was also an early investor in Google), wrote an email yesterday to the CEOs of his portfolio companies. In no uncertain terms he outlines a bleak immediate future, and gives advice to his startups. It’s the same advice, actually, that he gave in ...