Valuations

  • Context is key for valuations Crunch Network

    Context is key for valuations

    For most of the past five years, investors in software companies prized revenue growth above all else. Investors were more than willing to overlook near-term profitability (or lack thereof) in favor of an acute focus on growth. As a result, entrepreneurs were encouraged to invest in building massive sales teams as quickly as possible to accelerate revenue growth, regardless of the cost. Read More

  • Valuation metrics show weakening for the fourth straight quarter

    Valuation metrics show weakening for the fourth straight quarter

    The law firm Fenwick & West quietly released its third-quarter venture capital survey this past Friday, and its findings aren’t exactly shocking. At the same time, they hint at problems to come for some startups. The survey, which analyzed the valuations and terms of financings for 149 Bay Area companies that raised capital in the third quarter, showed that 71 percent of those… Read More

  • When every company is a tech company, valuations go insane Crunch Network

    When every company is a tech company, valuations go insane

    Users, subscribers, growth, global expansion, minimal marginal costs, the promise of future success; this all sounds a bit like the verbiage of a tech company — and that’s because the industry has fallen in love with the idea that every trendy fast-growing company is a tech company. Read More

  • What reset? Both seed- and late-stage valuations just hit record levels, says new report

    What reset? Both seed- and late-stage valuations just hit record levels, says new report

    Investors are valuing seed-stage startups at the highest levels ever, according to a new report published by the private deals database Pitchbook. According to its analysis, the pre-money valuation for a seed-stage company reached $5.9 million in the first half of this year, an 11 percent increase from the end of 2015 and a whopping 84 percent increase from 2010 figures. At the same time… Read More

  • Recapalypse now Crunch Network

    Recapalypse now

    Over the last couple of years of boom times for venture capital-backed startups, round sizes ballooned and valuations filled with all that hot air. Valuations of new financings have started declining significantly since the beginning of the year, leaving a number of companies hanging on precariously high in the air without solid ground beneath them. Read More

  • Snapchat is raising more money around $20 billion valuation

    Snapchat is raising more money around $20 billion valuation

    Snapchat may have first made its name in the crowded world of mobile apps with an ephemeral messaging service, but the startup and its wildly popular app are not disappearing anywhere soon. TechCrunch has learned from multiple sources that Snapchat is raising yet more financing at around a $20 billion valuation. Sources with knowledge of the deal say the social media giant is in the… Read More

  • Bill Gurley doesn’t think these giant new funds are such a great idea

    Bill Gurley doesn’t think these giant new funds are such a great idea

    “It’s not just the size of the funds but the velocity” at which VCs are returning to their investors, known as limited partners (or LPs), says an astonished Bill Gurley of the venture firm Benchmark. “The Kauffman fund said that billion dollar funds sucked, then everybody went out and raised billion-dollar funds.” Gurley is referring to a 2012 Kauffman… Read More

  • The SEC is voicing concern about ‘eye-popping’ startup valuations Crunch Network

    The SEC is voicing concern about ‘eye-popping’ startup valuations

    Management and boards at late-stage, or pre-IPO, companies are on notice that the SEC is paying attention to the late-stage financing arena, and should look internally to ensure that corporate governance and financial controls are befitting their scale, and should also ensure the accuracy of the disclosures they make when raising funds. Read More

  • Startups And The Big Lie

    Startups And The Big Lie

    A startup is hemorrhaging cash, and the VCs have yet to agree on terms for a capital infusion. The clock is ticking until deadpool, first weeks away then days. The founders, stress levels increasing to stratospheric levels, continue to sell their company to everyone, whether investors, employees, potential employees, or clients. They have little choice. Funding is contingent on growth, but… Read More

  • The Logic Of Crazy Valuations

    The Logic Of Crazy Valuations

    August is the traditional vacation month for venture capitalists, who stream out of their Sand Hill Road offices to quieter points, ostensibly to reflect on the year so far and prepare for the heavy fall fundraising season. And what a year it has been! We now have several companies valued at around $10 billion and above, including Airbnb, Dropbox, and Uber. Those valuations seem tame compared… Read More

  • Are Tech Companies Overvalued? | TC Disrupt NY 2014

    Are Tech Companies Overvalued? Top Investors Think So

    Is Winter coming? It’s already here, according to VCs like Fred Wilson of Union Square Ventures and John Lilly of Greylock. We asked some of the world’s most respected tech investors about “the bubble” at TechCrunch Disrupt NY. The consensus? Public tech company valuations soared too close to the sun, and the correction is now dragging down fundraising and IPO potential… Read More