Want to Know How VCs Calculate Valuation Differently from Founders?

I just watched (well, really mostly listened to) the video embedded in the article and I highly recommend it.

I was involved in VC negotiations during the bubble and was a bit confused about some of the stuff beyond the basics. Luckily, we had good lawyers and my partners were fairly well versed in finance.

I've also noticed that many people have are confused about how the corporate governence works. They also talk a little about how the board of directors work and how it interacts with investor rights.

Finally, if you're not comfortable with finance, you might need to watch it a few times before you fully understand what they're talking about, but it's well worth it.

This was an awesome post and very informative. I especially liked how he explained that the share pool would come out of the founders pool. That's something important to keep in mind as that's a huge amount of equity!

Sometimes I wonder if Mark knows that he could be getting much better deals if he didn't tell us all these things?

Why video? Isn't this the kind of information you would like to refer to frequently, which is hard to do in video format?

Well if you have raised 6 millions and you sell the company for 10 million, and still manage to get 1.6 million, then I think you made a very good deal.

As a young entrepreneur starting out, this video explained a number of terms (pun intended) that I had no idea about before.

Thanks Mark Suster!