Everyone Is Getting Discounts… VC’s Want One Too (Part 1)
Posted by Jeff Lu on March 12, 2009
My colleague on Twitter... the 2nd time someone commented to me on VC down rounds
Last week I heard two people comment to me about venture capital firms (VC’s) making a collective effort to use the economy as an “excuse” to lower valuations… and why shouldn’t they want a discount? Everywhere I look I see clothes, electronics, cars, services and, of course public equities being sold at a significant discount from what they were sold for the same time last year.
Originally, the main purpose of this entry is to talk about private company valuations and how VCs can make capital more expensive without lowering valuation, but now I’ve decided to divide this into a 3 parts. Part 1 will cover valuation of early stage companies, part 2 will cover how the the public equity markets are affecting private equity valuations and part 3 will cover down rounds and intricacies of term sheets.
WAIT! There is more to read… read on »
