It is the responsibility of the founders to keep an eye on the nuances of Business Valuation. Pre-money and Post-money valuation refer to company’s worth at two different timings. In simple terms, Pre-money valuation is company’s worth before it raises investment from VCs. Likewise, Post-money valuation is it’s worth after adding the financing received from investors.
This Pre-Money and Post-Money Valuation is crucial in determining equity offer to the investors. Hence young entrepreneurs must be well aware of how pre-money and post-money valuation is arrived at. So have you looked at what kind of valuation is your company thinking of before raising?
Sharda Balaji has expertise as an in-house attorney in various MNCs closing a wide range of deals. Here she talks about valuation. Also she is a CS and founder of law firm NovoJuris. Moreover she donned roles of legal counsel, founder, angel investor, Independent director and trustee. Sharda has nurtured many young entrepreneurs through their start-up journey.
This Start-up 101 series is a guidebook for business to novice entrepreneurs. Here are solutions for hundreds of questions you ever had and even for ones you haven’t thought of. In short, we have condensed the huge experience of various mentors and founders into a handy, user-friendly manual.