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valuation in negotiation

comparables cover

Comparables: How To Use Them To Defend Your Valuation [Video]

Do you prefer podcasts? Listen to the audio here. In valuation theory, comparables are referred to as those companies or deals that are similar in size, type of company and industry. Comparables can be very useful for setting your own milestones and projections. Making any type of financial or business planning is simply making an educated…

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equity boundaries

Equity Percentages to Offer Investors at Different Rounds [Video]

Do you prefer podcasts? Listen to the audio here. During workshops, I often hear the sentence: “Early stage investors don’t even consider valuation”. Truth is, even if it may seem that they are neglecting valuation, investors are simply looking at it from another perspective. Valuation is the starting point of each and every negotiation. For the simple reason that, at a certain point, everything…

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An Angel Investor And Economist On Dilution

There are two statements in general you can hear out there related to dilution: Future rounds are going to dilute my participation so you should allow me a larger share now to prevent this from happening! Cash is neutral; you are diluted in terms of control, but if you’d like to avoid dilution you can…

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Investors' required return

Understanding Investors’ Required Return

In the previous article we discussed Discounted Cash Flow valuation methods. These well-known methods discount future cash generated by the company to understand its value today. The cash flows are discounted according to the risk of realization. Indeed, the higher the risk that these cash flows will materialize, the lower their value today. However, the…

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With and without VCs, differences in valuation

I want to present my approach on how to deal with difficulty of contracting the value of the company with VCs. They know what they are talking about and if you don’t know much about finance, your counter arguments are going be weak. And, as a result, you are going to undersell your company. Today,…

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