Questions

Our annualised revenues are approx $2m USD, so we've already been given estimates by Accountants, legal expert who deals with M&A etc. that are extremely experienced in our field of what we could expect valuation to be. We want to be fair, but not give away more than we need to. Get there maybe a small discount. Possibly other proven angel investors we don't know so well they're keen introduce too (so how could we balance getting the most from this collectively?). How do you best arrive at this?!? (and should we consider e.g. convertible notes, something else as part of this). Thanks!

Since no one has actually answered your question, let me try and give you some specific guidance:

The "fair" range would probably land between $5m-$15m pre-money.

For the low-end ($5-6m) to be fair, you'd be in a tiny (measured by total addressable market) with slow growth on that $2m as measured by either Year-Over-Year or month-over-month, depending on the sales model.

Add a million to two million to the total pre-money the higher the TAM with no obvious incumbent to beat.

Add an additional million to four million for better growth and proven, scaleable low customer acquisition costs.

So that's how you would scale up or down a generally reasonable valuation.

I would answer your question with more specificity had you provided the important contextual details like industry, where the company is located, business model, but at the very high level abstract, this should be helpful to you.

Happy to do a call and give you a much more narrow range based on understanding the details..


Answered 5 years ago

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