Remove EBITDA Remove Terminal Value Remove Venture Capital Fund
article thumbnail

The Logic of the VC Method for Startup Valuation

Equidam

The basic formula for the VC Method is elegant: Present Value (Post‑Money) = Terminal Value / (1 + Required ROI) n Where n is the number of projected years used to find the terminal value. 3-5x the total capital invested). The higher the ROI, the lower the present value.

article thumbnail

Demystifying Valuation Clauses in LPAs for Emerging Managers

Equidam

Launching a venture capital fund involves navigating complex legal documents, chief among them the Limited Partnership Agreement (LPA). For first-time fund managers, one often-overlooked section of the LPA is the valuation clause – the provisions that dictate how the fund’s investments are valued over time.

article thumbnail

Startup Valuation: The Ultimate Guide for Founders

Equidam

1] Unlike valuing established public companies with long track records and stable earnings, startup valuation operates in a realm of high uncertainty. [2] Valuing Startup Ventures: Methods and Challenges. Funding Rounds and Valuation Factors. Valuing Pre-Revenue Startups Based on Future Potential.