Links or answers for Pre Money evaluation for seed funding


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We are looking to raise Angel funding and was wondering if anyone knows how to calculate the pre-money evaluation?

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asked Dec 15 '09 at 04:53
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Hoang
21 points
Get up to $750K in working capital to finance your business: Clarify Capital Business Loans

3 Answers


2

This depends a lot on what you do. Pre-money evaluations vary widely. Some things to consider are:

  • Like Products or Services: Find another company that is doing something similar. You can check out this site for who has gotten what in terms of funding.
  • The Team: How seasoned is the team and what is their track record? Based on your question, you probably are not that experienced with doing startups.
  • The Technology: Do you have IP? Is the idea even protectable? All of these things either add or detract from the value.
  • The Market: Is it a hot market or even a market at all? What competitors are out there that might eat your lunch once you are in the market?
  • The Milestones: What milestones will you achieve with the money raised? Is that realistic or just a dream, based on what other people have done?

So, without knowing your specific idea, market or your team dynamics, evaluating your pre-money evaluation will be tricky but the questions about will be how you would eventually get to an evaluation.

answered Dec 15 '09 at 05:17
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Jarie Bolander
11,421 points

2

Salman Khan has some tutorial on his page regarding Venture Capital and Capital Markets. I found this very helpful. He does a great job of explaining a number of concepts related to capital markets. Some of the tutorials are a bit high level for what you are looking for. Have a look (http://www.khanacademy.org/ ).

answered Dec 15 '09 at 08:11
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Jed Regan
266 points

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I already had this link and was wondering if anyone had some other articles or links that would explain the theory behind it.

Cap Table Basics

answered Dec 15 '09 at 07:17
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Hoang
21 points

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