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They mention repeatedly the amount raised, I didn't see where it said at what valuation. If they were left with 75% of the company, that would have been a nice
by blacksmythe 16y ago
They mention repeatedly the amount raised, I didn't see where it said at what valuation. If they were left with 75% of the company, that would have been a nice seed round. If they were left with 20% of the company, not so much.
- gojomo 16y agoGood chance it was convertible debt; thus there's no official valuation to report. What matters are any valuation caps on the conversion and the next-round valuation. My guess would be the seed investors have terms that are essentially like having 20-30% of the current company. Selling an effective majority stake (or anything near it) in a 'seed' round isn't a typical valley thing.
- gaganbiyani 16y agoYou're right - if we gave up 80% of the company, it would be an awful raise. However, it's a pretty fair assumption that we didn't do that. We chose to take in $1M instead of $300K (which is all we needed). Why would we take in more capital if the valuation wasn't fair?