The valuation is a negotiation, not a formula.

Startup founders negotiating valuation should consider the following points:

Know the current market rate for valuations for your stage and type of business.

Investors will see many deals like yours and will know the current rate.

Consider how to position your startup so it achieves the highest valuation.

Run the valuation through several different formulas to see which one provides the best result. 

This is where you want to start your valuation discussion.

It helps to show how the assets of the business meet or exceed the proposed valuation.

This shows the investor that there’s no speculation it.

Find comps that show the valuation of other businesses at a fundraise or exit.

This helps prove the case that your business is worth what you say it is.

Articulate all the values in the business.

This is the most important part of the negotiation process.

Highlight the team, the intellectual property, the revenue, and the product at the very least.

Show the value of each for today and not tomorrow.

Today’s valuation is for today’s fundraise.  

Tomorrow’s valuation is for tomorrow’s fundraise.

Investors are not interested in forecasts, but rather in what you have today.

 

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
________________________________________________________________________

Thank you for joining your host Hall T. Martin with the Startup Funding Espresso — your daily shot of startup funding and investing.
For more episodes from Investor Connect, please visit the site at: http://investorconnect.org
Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/
For Feedback please contact info@tencapital.group
Please follow, share, and leave a review.
Music courtesy of Bensound.

Copyright (c) 2025, Hall Martin and investorconnect.org. All rights reserved.

Disclaimer:
Hall T Martin is the director of Investor Connect, which is a 501(c)(3) nonprofit dedicated to the education of investors for early-stage funding. All opinions expressed by Hall and podcast guests are solely their own opinions and do not reflect the opinion of Investor Connect. This podcast is for informational purposes only and should not be relied upon for the basis of investment decisions.