• February 2019
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How do Angels and VC value very early stage startups?

There’s no single method when it comes to assigning a value to a business.

As with most things related to startups, what works for one business may not work for another. This kind of puts people in a spot. But there are some areas that you should consider that will help you come to a general value.

  • What does the business own? Think about any equipment or large-item products that your business needs to function. That adds overall value to your business.
  • Do you have any revenue? This is kind of a bare-bones approach to understanding the ballpark of what a business is worth. Depending on which industry you are in, you could use a multiplier to determine what your overall worth is. You’ll need to look up some information on your industry to better estimate this way.
  • Keep in mind the value of the people that you have on your team. This is an area that matters quite a bit in a startup, especially if there’s no cash flow yet. Consider the invaluable resources that you and other key players bring to the table.

As you develop your business, you should get a few solid resources in your corner. LawTrades has already assisted over 1000 entrepreneurs with various stages of a startup. We’d be happy to help you, too. We offer affordable low rates and quick, direct communication. Get in touch if you think we’re a good fit.

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