Start up valuation - how much equity


4

Approached by 2 founders that are very early days of executing an idea.

They have some good .com properties that will be central to brand/idea and had recent offers around $100K, with one outlier at $250K. Domains were purchased a few years ago for around $60K

I am thinking of joining and quitting my day job. I have agreed with tossing some cash into the company based on the value of the domain, idea, and very early stage work they have done. I can't decide on a reasonable value.

Value of domains at cost ($60K); estimated market value of domain ($100 to $200k), or some other value? Would love to hear thoughts.

Funding Co-Founder Equity Investors Seed Funding

asked Feb 8 '12 at 12:24
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Jjj
21 points
  • What is your question? – Tim J 8 years ago

1 Answer


4

Take a look at what the revenue/profit projections are for the next 3-5 years and then discount them back to present day. That will give you a reasonably good idea what it could be worth.

The evaluation will be somewhere in between what the present value is ($60k to $200k) and the future value.

After that, it's kinda up to you to negotiate from there.

Another option is to look for comparables of similar sites and see what they are worth, etc.

Good luck

answered Feb 8 '12 at 14:36
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Jarie Bolander
11,421 points

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