How to Value Your Startup Business (2011)

http://redrocketvc.blogspot.com.ar/2011/05/lesson-32-how-to-value-your-startup.html

by wslh • 13 years ago

25 9 13 years ago

redrocketvc.blogspot.com.ar

feifan• 13 years ago

Along with the idea of creating demand, I'm a proponent of bootstrapping until you get investors wanting to invest in you. Leads to a much better outcome for the company.

porter• 13 years ago

If there is no revenue then you can also take a top-down approach by looking at the number of potential customers in your market you expect to capture. Then base the valuation off of that expected future revenue scenario. VC funding just helps you get to that future destination, ultimately giving your investors their 10x return.

sinwave3• 13 years ago

"The more scarce a supply (e.g., your equity in a hot new patented technology business), the higher the demand"

Ooof. That's not any economics I've heard of.

logicallee3• 13 years ago

you've never heard of scarcity or the illusion of scarcity driving up demand at higher prices, or causing the market to clear at higher prices? Today nobody wants bitcoin at ten thousand, even though some people might still want it if it started clearing at that price: the reason this isn't happening, then, is that bitcoins are not scarce enough to reach that price. The existing demand is met by supply at a lower price. In sum, even if the investor sentiment were exactly the same, it would definitely be true that "The more scarce a supply, the higher the [prices cleared by existing] demand", or to some extent the higher actual demand. (Nobody would pay for a gallon of air today - but if people perceived it as being a bit scarce, maybe some people would even without its becoming actually scarcer.)

sinwave3• 13 years ago

I was just trying to draw the exact distinction you make. Scarcity of supply leads to higher price given demand, NOT a shift in the demand curve. Perhaps I'm nitpicking, but the language used in the article suggested a misunderstanding of econ fundamentals.

coofluence• 13 years ago

There is not one bit of useful information in this article. It's just an breezy overview.

How to Value Your Startup Business (2011)

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