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General VC Questions

What are your preferred methods of company valuation for an early stage firm w/ no revenues? Comps, the VC method, scorecard method, etc.?

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Jan 25, 2024
1 answer
Accepted Answer
Feb 21, 2024
Though there are "standard seed-stage valuation methods" (Comps, VC, Scorecard, Berkus) valuation at early stage (pre-revenue) is a bit more art than science, a balance between optimism and delusion and between strategy and tactics. Factors include:
  • Team - their ability to build a company to execute
  • Target market(s) size(s)
  • Potential for the startup to dominate, create or disrupt the market for substantial revenue
  • Unique Value Proposition, and is it compelling to potential customers
  • What is the Go-To-Market strategy
  • What are the economics
  • A realistic understanding of the competitive landscape
  • What is the capital investment required to get to milestones:  Proof-Of-Concept, Minimum-Viable-Product, Product-Market-Fit
  • What is the technology and does it scale
  • What is the intellectual property
  • What are the risks
  • Exit potential

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