This is a useful estimation formula, and I'm not sure why you're getting downvoted. The reasoning is as follows: institutional investors prioritize ownership %

This is a useful estimation formula, and I'm not sure why you're getting downvoted. The reasoning is as follows: institutional investors prioritize ownership % over $. For the first couple financing rounds, they will want 15-25% of the business and will increase the check size until they get that. If they get 25%, post-money valuation of the business is 4x the investment. If they get 20%, post-money = 5x the amount. There are outliers, but "post-money = 4-5x the check size" is a useful heuristic for mid-market deals.