3 ms·
I am torn about using valuation to rank companies. Valuation is is a vanity metric. Its just a number that VCs use to trade their capital, not the true worth of
by ajoy 8y ago
I am torn about using valuation to rank companies. Valuation is is a vanity metric. Its just a number that VCs use to trade their capital, not the true worth of a company. You could raise $1 million from your rich uncle claiming to hold 0.1% of company and claim a $1B valuation. But then the question is, what do you use as the true worth of a company?
- laser 8y agoBut I don't think any of these were valued by their rich uncles—they were primarily valued by professional venture capitalists putting money into the companies at said valuations. Venture capitalists may have flaws in their valuation methodologies, but who's valuation could you trust more than theirs, as they put their money where their mouth is?