Infographic: Valuation – The Venture Capital Method

I created this infographic to help my undergraduate students understand the way VCs often triangulate to a pre-money valuation. This method is particularly useful for early-stage start ups where there is little quantitative information available. In my opinion, the pre-money number thrown on the table, however, is not where you want to focus. You want to look at the percent of the company that you still own after the deal and make sure you understand what that means in terms of the additional investment your company will require prior to exit. Check out this post I wrote – Valuation: The Venture Capital Method – for more articles on the topic.