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Echoing this question. I worked in smallcap investment banking for several years. My bank wouldn't speak to you if you didn't have 2-3 years of Audited financi
by themanmaran 4y ago
Echoing this question.
I worked in smallcap investment banking for several years. My bank wouldn't speak to you if you didn't have 2-3 years of Audited financials (note: not 'Reviewed' or a 'Compilation'). Often we would request an additional audit if we didn't recognize the firm that did the prior auditing.
All for a valuation range of $200MM - $500MM.
Meanwhile a hastily compiled excel sheet seems to satisfy the largest VC's in the market? Billion dollar valuations based on totally unsubstantiated numbers?
Audit's are expensive (like $30-$80k). But surely better than losing $200MM on hot air.
- erostrate 4y agoIt's worse than that. That spreadsheet was created after FTX became insolvent. When Sequoia invested, they probably didn't even have something as good as that terrible spreadsheet. Or more charitably, Sequoia presented with something more professional looking, but completely incorrect.
- rippercushions 4y agoFamously, SBF was playing League of Legends while pitching to Sequoia, and they just about fell over themselves in aww at his quirky genius. Matt even quotes this bit in the article.
- deleted 4y ago[deleted]
- dralley 4y agoI really cannot believe just how on the nose HBO's "Silicon Valley" was.