Startup valuations can be a tricky business. Just take a look at Flow, a real estate company that's still in its early stages. Despite not even being

Startup Valuations Entrepreneurs Should Be Aware Of

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2022-09-22 22:00:50

Startup valuations can be a tricky business. Just take a look at Flow, a real estate company that's still in its early stages. Despite not even being built yet, it was valued by investors at over $1B - and the founder, Adam Neumann, is far from an upstanding citizen.

WeWork, Neumann's previous venture, provides a perfect example of this. The company was highly valued during its early years, but rapidly lost its shine as Neumann's questionable business practices came to light.

So what exactly goes into deciding a startup's value? And why do some companies seem to get away with more than others? In this article, we'll take a closer look at startup valuations and try to answer some of these questions.

The rules of the game for raising VC funding is sufficiently narrow as to where startup valuations should be within certain ranges. Startups then start ups have varying degrees of difficulty in attracting return backers.

Startups can determine their own valuation and in some cases, large companies use the exit market to obtain revenue or a valuation.