Industry Records

Fundraising
OTC Medication
Dating
Green Homes
Finance
If you are faced with an emergency, payday loans can help.
View Freddie Rick's professional profile on LinkedIn.Freddie Rick is the founder of Better Trades, an education company that imparts stock market education.

internet directory
web portal
japanese advice
information websites
japanese news
japanese data

User Login

Feed Entries

Home

Industry Records

Angel Investors and Valuing

Valuationputting a value on a business is a difficult task even for professionals. The task is that much more daunting for nonprofessional investors, a subset of the investment universe that includes most angels. The more sophisticated angels have wrestled with the issue and come up with a solution: next-round pricing. This methodology may be best illuminated in question-and-answer format.

Q: How do you value a start-up in the angel round when there are no revenues, customers, nor complete management teams... just a concept and some intellectual property?

A: Increasingly, the answer is that you don't. You value the company for the purposes of allocating percentage interests for a given amount of money on the basis of the next round, the so-called Series A round.

Q: Why postpone the valuation?

A: First, it's very hard for angels, particularly angels who are not routinely involved in the venture capital business, to come to an intelligent estimate of valuation when so many factors are yet to be known or realized. Secondly, angels are often friends and family (the angel round is sometimes called the friends-and-family round), and there's a natural reluctance to drive a hard bargain with a relative, a former college roommate, or the best

User Login

Latest News