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Startup valuation

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Atlas Overview 200912
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Startup valuation

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Startup valuation

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  1. 1. Startup valuation Denis Dovgopoliy denny.do@gmail.com LI, FB, Twi, Telegram
  2. 2. Pre-revenue startup valuation methods
  3. 3. Venture Capital (VC) Method Post-money valuation = Terminal value ÷ Expected ROI Pre-money valuation = Post-money valuation — Investment
  4. 4. Berkus Method
  5. 5. Berkus Method Sound Idea (basic value) Prototype (reduces technology risk) Quality Management Team (reduces execution risk) Strategic Relationships (reduces market risk) Product Rollout or Sales (reduces production risk)
  6. 6. Scorecard Valuation Method Strength of the Management Team (0–30%) Size of the Opportunity (0–25%) Product/Technology (0–15%) Competitive Environment (0–10%) Marketing/Sales Channels/Partnerships (0–10%) Need for Additional Investment (0–5%) Other (0–5%)
  7. 7. Risk Factor Summation Method
  8. 8. Deferred valuation method CL (CD, CB) or SAFE
  9. 9. Startup valuation methods (post revenue*) on cash-in deals (ARR/AR > $1M)
  10. 10. Comparable Transactions Method “The Comparable Transactions Method is really just a rule of three”
  11. 11. Comparable Transactions Method (example)
  12. 12. Other methods Discounted Cash Flow method Book Value Method Liquidation Value Method First Chicago Method Other Bullshit
  13. 13. Other factors Competition (both side) Delusion Motivation
  14. 14. But: Preseed - 5-10% or non equity financing (10-50k USD) - Idea Seed - 5 - 15% or non equity financing (50k-1M USD) - Prototype Round A - 15-40% (5-15M USD) - Go to market Round B - 5-20% - Scaling Round C - up to 10% - Expansion
  15. 15. Oooooooops! Risks are too high! Remember the number: 99.7
  16. 16. But return is high!
  17. 17. Thank you! Sincerely yours, Denis Dovgopoliy, denny.do@gmail.com

Description

Startup valuation

Transcript

  1. 1. Startup valuation Denis Dovgopoliy denny.do@gmail.com LI, FB, Twi, Telegram
  2. 2. Pre-revenue startup valuation methods
  3. 3. Venture Capital (VC) Method Post-money valuation = Terminal value ÷ Expected ROI Pre-money valuation = Post-money valuation — Investment
  4. 4. Berkus Method
  5. 5. Berkus Method Sound Idea (basic value) Prototype (reduces technology risk) Quality Management Team (reduces execution risk) Strategic Relationships (reduces market risk) Product Rollout or Sales (reduces production risk)
  6. 6. Scorecard Valuation Method Strength of the Management Team (0–30%) Size of the Opportunity (0–25%) Product/Technology (0–15%) Competitive Environment (0–10%) Marketing/Sales Channels/Partnerships (0–10%) Need for Additional Investment (0–5%) Other (0–5%)
  7. 7. Risk Factor Summation Method
  8. 8. Deferred valuation method CL (CD, CB) or SAFE
  9. 9. Startup valuation methods (post revenue*) on cash-in deals (ARR/AR > $1M)
  10. 10. Comparable Transactions Method “The Comparable Transactions Method is really just a rule of three”
  11. 11. Comparable Transactions Method (example)
  12. 12. Other methods Discounted Cash Flow method Book Value Method Liquidation Value Method First Chicago Method Other Bullshit
  13. 13. Other factors Competition (both side) Delusion Motivation
  14. 14. But: Preseed - 5-10% or non equity financing (10-50k USD) - Idea Seed - 5 - 15% or non equity financing (50k-1M USD) - Prototype Round A - 15-40% (5-15M USD) - Go to market Round B - 5-20% - Scaling Round C - up to 10% - Expansion
  15. 15. Oooooooops! Risks are too high! Remember the number: 99.7
  16. 16. But return is high!
  17. 17. Thank you! Sincerely yours, Denis Dovgopoliy, denny.do@gmail.com

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