Pre-Money Valuation

The valuation of a company immediately after a new funding round, calculated as the pre-money valuation plus the capital raised. Post-money valuation determines the ownership percentage that new investors receive for their investment.

A valuation methodology that determines the total value of a diversified company by independently valuing each business segment, product line, or asset category and aggregating the results. Sum-of-the-parts analysis is particularly useful when a conglomerate's divisions operate in different industries with distinct risk profiles, growth rates, and comparable company sets.

A ratio used to estimate the value of a company by comparing its market value or enterprise value to a financial metric such as revenue, EBITDA, or earnings. Higher multiples typically reflect stronger growth prospects, margin quality, and intangible asset positions.

The process of estimating the economic value of a company's active user community, considering metrics such as engagement levels, conversion rates, lifetime value, and network effects. User base valuation is central to the assessment of platform businesses and social media companies, where the user community itself is the primary intangible asset.

A set of globally recognised standards published by the International Valuation Standards Council (IVSC) that provide a framework for consistent, transparent, and objective asset valuation. IVS covers the valuation of tangible assets, intangible assets, financial instruments, and businesses, and is increasingly referenced by regulators and accounting standard-setters.

A term in a venture capital or private equity investment that determines the order and amount in which investors are paid before other shareholders in a liquidation event (sale, wind-down, or IPO). Common structures include 1x non-participating and 1x participating preferences.

A short-term debt instrument that converts into equity at a future financing round, typically at a discount to the next round's valuation. Convertible notes are commonly used in seed-stage financing because they defer the need to establish a valuation.

A group of investors who co-invest together in a single funding round, typically organised by a lead investor. Syndicates spread risk across multiple investors and allow companies to access a broader range of expertise, networks, and follow-on capital.

Pre-Revenue Startup Valuation: Intangible Asset Methods That Actually Work

Pre-revenue startups are notoriously difficult to value using traditional methods. Revenue multiples fail when there is no revenue. DCF models rely on projections that are mostly fiction. Intangible asset valuation offers a third path — grounded in what a startup has actually built, not what it hopes to earn.

What valuation should I expect for my Series A?

Series A valuations vary widely but typically range from 2-10x Series Seed valuation. Stage, metrics, market, and team drive the multiple — 20-50x revenue (for SaaS) or 5-10x revenue (for marketplaces) are common benchmarks.

How do you value a startup with no revenue?

Pre-revenue startups are valued using the Scorecard Method, Berkus Method, or Comparable Transaction approach — all of which focus on the team, technology, market opportunity, and intangible asset quality rather than financial metrics.

What is the Scorecard Method for startup valuation?

The Scorecard Method values pre-revenue startups by comparing them to similar funded companies in the region, then adjusting the median valuation based on the startup's relative strength across key factors.