tag:blogger.com,1999:blog-3327656696432309458.post4013803735589059147..comments2023-08-24T08:08:45.755-06:00Comments on Shark Tank Success Blog: Element BarsShark Tank Successhttp://www.blogger.com/profile/12562867052494196829noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-3327656696432309458.post-53977533171086350272015-09-17T21:01:08.658-06:002015-09-17T21:01:08.658-06:00The $850K valuation by anonymous 2 is incorrect. I...The $850K valuation by anonymous 2 is incorrect. It is simple math.The investor PAYS $150K in exchange 15% equity, thereby valuing the company at $1M. The owner of the company can take the $150K and do whatever they want with it. Let's say the owner of the company offered 100% of the company for $150K. Using anonymous 2's reasoning, the valuation would be 0 before the $150K investment. Anonymoushttps://www.blogger.com/profile/11850296415502226142noreply@blogger.comtag:blogger.com,1999:blog-3327656696432309458.post-36195982868623498262014-11-18T10:02:24.245-07:002014-11-18T10:02:24.245-07:00Actually, first anonymous was correct. In you two...Actually, first anonymous was correct. In you two are arguing what is known in VC as pre-money and post-money. In this case, the company is 850K pre-money and 1M post money based on this valuation. That is just straight numbers.<br /><br />To be fair, bringing an experienced business partner on can increase the value of the company, so if you could put a dollar on that, you might get closer toAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-3327656696432309458.post-22238846679563723192014-11-06T18:24:50.291-07:002014-11-06T18:24:50.291-07:00That's actually not correct Anonymous: the va...That's actually not correct Anonymous: the valuation is the value the entrepreneur is receiving the money at. If an investor gives money at a $1,000,000 valuation, then they are valuing the company at $1,000,000. If the company had no money beforehand and was given $150,000, it will now have $150,000 at a $1,000,000 valuation. It does not mean the value was $850,000 prior, it means the Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3327656696432309458.post-29684543709776671942014-03-01T09:22:55.498-07:002014-03-01T09:22:55.498-07:00But that is after the $150,000 is put in the busin...But that is after the $150,000 is put in the business. So the business value prior to the sale was $1,000,000-150,000= $850,000.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3327656696432309458.post-4344829931859577022014-01-30T15:21:24.508-07:002014-01-30T15:21:24.508-07:00You calculate the valuation by the amount of cash ...You calculate the valuation by the amount of cash desired divided by the percentage. Therefore if you divide 150k by .15 = 1000000.00 dollars. It is basically as though you are saying 15% of the company is worth 150K so you calculate it out and that gives you the total (estimated) worth of the company.Clark The Shark Saxeyhttps://www.blogger.com/profile/01598627816047570940noreply@blogger.comtag:blogger.com,1999:blog-3327656696432309458.post-4244665973702608822014-01-20T11:33:22.606-07:002014-01-20T11:33:22.606-07:00how do you come up with the valuation?how do you come up with the valuation?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3327656696432309458.post-65756512983326475932013-07-05T10:48:41.508-06:002013-07-05T10:48:41.508-06:00the valuation originally was 1 million not 2.25 - ...the valuation originally was 1 million not 2.25 - 150K at 15% is 1 million for 100% DUHHHHAnonymousnoreply@blogger.com