Many factors weigh on the valuation of a company, and for sure there are no two businesses alike. Furthermore, even similar companies find themselves at different stages of their lives when they start talking with investors and buyers: some are consolidating while others are expanding; some are profitable right away and others are not for a long time; some are not even generating revenues when they are acquired.
But a very effective way to monitor the market (albeit quite simplistic) is to benchmark the M&A activity in a specific sector and in a given period. Markets go through different phases after all and there might be more or less appetite for companies like yours, and therefore investors might be inclined to accept higher or lower valuations.
When you’re setting out into the world of business, some widely accepted wisdom states that you need a business partner. After all, starting a company is tough, and you need all the help you can get, right?
However, that’s not really true…
Having a co-founder helps in many ways, but you also have the option of doing it alone.
The Checklist method compares early-stage startups within the same geographical market, taking as highest value the highest valuations in the market, with the exclusion of outliers and notable “crazy” exceptions.
After gathering this local data you are left with a maximum pre-money valuation and you will discount this valuation by the quality of the criteria assessed. In other words, it’s impossible to end up with a valuation higher than this maximum benchmark.
In a bid to celebrate Global Entrepreneurship Week, we are celebrating and spotlighting some amazing inventions that have changed the world, especially those that help us as entrepreneurs to do business better
All you need is being unconventional!
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When looking at early-stage valuations, our favourite approach is to rely on benchmarks from the market and then compare them with the start-up we are valuing. We normally arrive at a final value by using two different methods: the ‘scorecard’ and the ‘checklist’ methods…
The digital age has made it much easier for cowboys to create convincing profiles online to extort young businesses… but with a good understanding of some common red flags, you can be confident that you are working only with legitimate potential investors.
Are we on the verge of creating artificial influencers, marketers and salesmen that will target artificial decision makers? Will procurement become an hyperfast and hypercompetitive process, akin to what high-frequency trading is today? It seems the world is already moving in this direction… Will B2A become an important part of the market?
It is generally agreed that four to ten measurements may be suitable for the majority of companies, but the number and type of key performance indicators used may change depending on the company and also over time
A patented remote power technology that is fully scalable, green, and affordable, WITT’s tech transforms kinetic energy that exists in motion, whether naturally occurring or manmade, into clean electrical power.
Whilst it is obviously important for the deck to include a persuasive pitch for investment, it’s also vitally important that you include a disclaimer to protect yourself from any legal action further down the line.
Have you heard about the Scorecard Valuation Method? It is a way of determining the value of a startup and can be seen as particularly useful by pre-seed and seed-stage investors.
It recently happened to one of our clients: their company is UK based, with no operations or interests in the UAE – they are fundraising and this investor contacted them out of the blue with a tempting message…
The lean startup method aims to find and develop a business or product for which there is demand. You start with your idea, then you test and develop from the feedback you get, not according to your opinions or fixed ideas.
Whether you’re a start-up business or looking to grow in size, when it comes to speaking with potential angel or venture capital investors, a “pitch deck” can be an invaluable asset. Typically, it is difficult and time-consuming to raise capital from investors.
Technology Readiness Levels (TRLs) are a type of measurement system to assess the maturity level of a particular technology. TRLs are based on a scale from TRL 1 to TRL 9, with TRL 9 being the technology at its most mature level.
Finding investors can feel like an incredible thing – but make sure you carry out these checks and look before you leap.
Early-stage valuations may feel uncomfortable for both founders and investors… Is there a simple way?
We are happy to announce that we’ve partnered with Equidam: an online platform for startup valuation that enables entrepreneurs to understand their valuation, transparently discuss it, and close fair deals.
A sophisticated investor is an investor that has sufficient capital and experience to evaluate independently the soundness of an investment opportunity, and bring forward such investment process.
In the past weeks we have established why valuations are helpful, when it makes sense to get your venture evaluated and what are the most common valuation methods for revenue generating companies and early-stage startups.
Being a successful entrepreneur is a race all be it, at times, a slow and steady one. There is a start line and as soon as that starting gun fires there will be hurdle after hurdle along the course. The hurdles may slow you down or they may even knock you down and bring you to a halt. You determine if that hurdle is to become your finish line.
In order to encourage investment into startups and early-stage businesses the UK Government has created a tax relief scheme called EIS: Enterprise Investment Scheme. This takes the form of…
Everybody has a desire to accrue wealth – we all want more money for our families and for ourselves. But the vast majority of us…
A capitalisation table offers a breakdown of the shareholder equity that a company has. These tables or spreadsheets are known as cap tables and…
If you have decided to sell your business or are looking for investments with Venture Capital, you may be wondering whether to advertise your business with an anonymous teaser…
When it comes to your start-up, you want to ensure complete equality of equity. Finances are of the utmost importance, and it’s essential you find a way of fairly and impartially determining the stakes in your business.
The startup life cycle has 6 stages, no wait 5, no, another website said 7 stages and then if you actually read The Lean Startup by Eric Ries then you will have read that there are 3 startup stages.
Let’s face it, it doesn’t really matter how many stages there are, as long as you understand the steps involved you will be able to figure out where you are at and what the next steps on your growth path are.
Crowdfunding: you put together a video, ready to let your idea off into the investment stratosphere. But what goes in the video?
The question is: how can we evaluate the startup if we have not yet reached the stage where recurring revenues are the norm?