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Pre and post-money valuation calculator

Calculate the pre and post-money value of your company
Author
Rho editorial team
Updated
December 12, 2024
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7
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Startup Valuation Calculator

What is startup valuation?

Startup valuation is the process of determining the economic value of a company. It's a critical metric for founders, investors, and stakeholders as it influences equity distribution, funding rounds, and potential exits.

Pre-money vs. post-money valuation

Two common methods of startup valuation are pre-money and post-money valuation:

  • Pre-money valuation: The company's value before receiving new investments
  • Post-money valuation: The company's value after receiving new investments

What's the formula to calculate pre and post-money valuation?

The formulas to calculate pre-money and post-money valuations are:

Pre-money valuation formula‍

Post-money valuation - investment amount

Post-money valuation formula‍

Investment dollar amount ÷ percent investor receives

What impacts startup valuation?

Several factors can influence your startup's valuation:

  1. Market size and growth potential: A large, rapidly growing market can lead to higher valuations.
  2. Traction: User growth, revenue, and other key performance indicators (KPIs) demonstrate your startup's potential.
  3. Team: Experienced founders and a skilled team can significantly boost valuation.
  4. Intellectual property: Unique technology or patents can set your startup apart.

Three additional startup valuation methods

While there's no one-size-fits-all approach to startup valuation, some additional methods include:

  1. Comparable analysis: Comparing your startup to similar companies that have recently raised funding or been acquired.
  2. Discounted Cash Flow (DCF): Projecting future cash flows and discounting them to present value.
  3. Berkus Method: Assigning monetary values to key elements of the business, such as sound idea, prototype, quality management team, strategic relationships, and product rollout or sales.

Wrap-up

Understanding startup valuation is essential for founders navigating the complex world of fundraising and growth.

By focusing on key value drivers and demonstrating your company's potential, you can maximize your startup's valuation and set the stage for long-term success. Use our startup valuation calculator to get an estimate of your company's worth and track your progress over time.

Rho is a fintech company, not a bank. Checking and card services provided by Webster Bank, N.A., member FDIC; savings account services provided by American Deposit Management, LLC, and its partner banks.

Note: This content is for informational purposes only. It doesn't necessarily reflect the views of Rho and should not be construed as legal, tax, benefits, financial, accounting, or other advice. If you need specific advice for your business, please consult with an expert, as rules and regulations change regularly.

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Rho is a fintech company, not a bank or an FDIC-insured depository institution. Checking account and card services provided by Webster Bank N.A., member FDIC. Savings account services provided by American Deposit Management Co. and its partner banks. International and foreign currency payments services are provided by Wise US Inc. FDIC deposit insurance coverage is available only to protect you against the failure of an FDIC-insured bank that holds your deposits and subject to FDIC limitations and requirements. It does not protect you against the failure of Rho or other third party.
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Rho is a fintech company, not a bank. Checking and card services provided by Webster Bank, N.A., member FDIC; savings account services provided by American Deposit Management Co. and its partner banks.