Valuation of Early-Stage Companies

There is no mathematical or logical method to determine the valuation of a pre-revenue company.

Invariably, the subject of company valuations arises in nearly all discussions about company funding.  Each company, investor, consultant, mentor, coach, and passerby has an opinion.  A few even have “facts” to justify their opinions.  For mature private companies with a lengthy track record and large installed customer base, a few mathematical models can be used as justification.  Unfortunately, for pre-revenue companies, there is no standard or appropriate valuation method.