http://startitup.indieword.com/person/8091 Wed, 09 May 2007 00:22:30 GMT Stories by Amit Bijlani http://startitup.indieword.com/view/question-of-the-day24 http://startitup.indieword.com/view/question-of-the-day24 <p><em>This is a revision of Amit&#8217;s Question from Tues May 8, 2007</em></p> <p>Every startup wants to believe that they are unique and revolutionary, it is no different in our case. We do have a business model and revenue projections but after reading several articles on startup valuation and listening to Guy Kawasaki, it seems like basing your valuation on revenue projections is not a sound strategy. Investors seem to prefer something more tangible, ie. assets, patented technology, user base, etc. Our competitors are privately-held, so we have no information on their revenue or other metrics to use to build a comparative valuation for our company.<br />Let me rephrase the question:<br />What are rules for a startup to build a sound valuation without using revenue projections?<br />What are the assumptions one should take into account? <br />When you are approaching angels and have no revenues or patents or other comparative metrics as yet, how do you justify 10% equity with X dollars? Is it OK to just base it on revenue <em>projections</em>?</p> Wed, 09 May 2007 00:22:30 GMT Amit Bijlani Read: Questions http://startitup.indieword.com/view/question-of-the-day37 http://startitup.indieword.com/view/question-of-the-day37 <p><em>This is a revision of Amit&#8217;s Question from Tues May 8, 2007</em><br />Every startup wants to believe that they are unique and revolutionary, it is no different in our case. We do have a business model and revenue projections but after reading several articles on startup valuation and listening to Guy Kawasaki, it seems like basing your valuation on revenue projections is not a sound strategy. Investors seem to prefer something more tangible, ie. assets, patented technology, user base, etc. Our competitors are privately-held, so we have no information on their revenue or other metrics to use to build a comparative valuation for our company.<br />Let me rephrase the question:<br />What are rules for a startup to build a sound valuation without using revenue projections?<br />What are the assumptions one should take into account? <br />When you are approaching angels and have no revenues or patents or other comparative metrics as yet, how do you justify 10% equity with X dollars? Is it OK to just base it on revenue <em>projections</em>?</p> Thu, 10 May 2007 16:04:20 GMT Amit Bijlani Read: Questions