David Wald

How to value a seed stage company? Who knows...(Well, Jack McQuire does but I had to fill in for him at the last minute for last week's Valuation Masterclass.) Here's a slide I prepared highlighting some of the recent seed rounds we have led and supported. Two surefire valuation methods: comparables (i.e. numerous rational references to companies similar to you) and the market (i.e. pitch as many investors as you can and see where they land). I have seen valuations double simply as a result of well-managed competitive processes. Governance, Terms, and War Stories sessions coming up. Register here: https://lnkd.in/ghJJpdR4

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🎙️ Exciting insights from SaaS Academy's CEO Johnny Page on the Expertise Economy podcast! Johnny breaks down their two-step approach to helping SaaS founders: 1️⃣ The Discovery Call: Uncovering the founder's "why" and long-term vision 2️⃣ The Strategic Game Plan Session: Creating a 90-day action plan to achieve 12-month goals 🔑 Key focus: Identifying and solving business constraints Want to dive deeper on the secrets of building a successful SaaS business? Check out the full episode here: https://lnkd.in/dju-Be2u #SaaS #BusinessStrategy #SaasAcademy #ExpertiseEconomy #Podcast

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I just had a fun call with Peter Walker. He's going to join the event we're hosting next week covering the SEED CRUST — the state of the #Seed market. Some interesting data points on Seed & Pre-Seed Quarterly Deal Values from PitchBook: 2014-2017: $1.4B 2018-2020: $2.2B 2021-2022: $5.4B 2023-2024: $3.6B (through Q1) One of these things does not look like the other. One of the key messages that Peter and I talked about today—and will probably really hammer on next week—is this: ▶ 2021 was an anomaly ◀ And anomalies can lead to anomalous thinking. What's happening in the market is only the backdrop. You need to be aware of the market conditions. But the most important part is how you run your #startup. Join us on Thursday May 2nd @ 1pm ET // 10am PT for the full report, analysis and insights. https://lnkd.in/g9FyiEps #startups #fundraising #founders #venturecapital

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So many of the VC-backed teams I work with say Triage is the best tool they've ever used for team alignment. #venturebacked #vcbacked #venturecapital #leadership #ceo #founder #operatingsystem #peakOS

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KNOW YOUR REAL BUSINESS ECONOMICS • GAAP Revenue • Cash Flow • Cash • Contribution Margin • CAC • CAC Payback FUNDRAISING: PRESENT & SUBSTANTIATE FINANCIALS • Investor needs to know what your forecasts are • They need to believe them David Weiden, Khosla Ventures

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Thanks for sharing the knowledge, as always Pablos Holman! Anyone in VC that’s interested in an easy non- CRM solution, check out his video

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When you hear "EXIT" you probably think that the company sold to a PE firm or it went public via an IPO, but that's not always what an "EXIT" means. Different types of exits for Founders: partner buyout sold out in the secondaries company did a stock buy back all stock purchase PE buyer utilizing a leveraged buyout sold utilizing seller financing totally got diluted down to zero BK sold in receivership gifted ownership to charity walked away and took nothing got fired and the company paid you fair market value company got purchased buy nobody made any money upon the sale raised some capital the wrong way and the investors are suing you for the company plus damages... So, when you see someone with "multiple exits", ask some questions as your idea of what an exit is may be completely different from what the actual facts are. Just sayin...

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Private equity buyers love recurring revenue like Joan Jett loves rock 'n' roll. A surefire way to achieve multiple expansion in a PE deal? Grow the % of recurring revenue during your hold period. Perhaps one of the most value-generative questions a board/mgmt team should ask itself early in the hold period: "How can we grow our % of recurring revenue?" Hit on this in the book (Winning Move #99), but check out the vid below for a deeper dive on how to grow RR. ▶️ * * * * * Found this helpful? Plenty more where that came from. Check out the Winning Moves Platform: the ambitious PE leader's toolkit for accelerating value creation. ↳ A digital arsenal of resources, how-to's, and tools to help private equity leaders make value-generating Winning Moves with confidence. Link in the comments below. ⤵️

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Our friends from High Alpha have launched the 2024 SaaS Benchmarks survey! 📈 By participating, you'll see how you stack up against your peers and what it takes to be a standout SaaS business.   Dive into the survey now!👇  Take the survey here: https://lnkd.in/e6s2hbaH #SaaSBenchmarks #SaaSfounders #SaaSstartups #AlternativeFunding #B2BSaaS

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Are we super-heroes at Preferred CFO? You be the judge. We helped a client with over 400 employees & multiple headwinds...we raised $50M and the company is now thriving. Need private capital? We do all the work with no success fee or percentage of the deal. Hire a real superhero in our "pay as you go" model. #CapitalRaise #PrivateCapital #FractionalCFO #PrivateEquity #CFO

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🌱 For founders taking on venture debt, covenants are the fine print you cannot afford to ignore. 📃 They set the boundaries for how you can operate and manage your company’s finances. If you don’t play by these rules, the consequences can be pretty dire. It’s all about negotiating terms that align with your startup’s financial health. Be sure to read the original post by Kruze Consulting to get the full breakdown. Link in the 1st comment. 👇 #StartupFinance

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One of the hardest things about being a “founder” is giving up control. I spent 17 or so years on the front lines of GTM for really special founders. In venture backed technology, that also means I worked for investors. Like anything, they aren’t all created equal. Around 10% of VC investments are estimated to achieve a 10x return or greater. You do that, and you’re an excellent investor. And you know you’re excellent. So when you get inputs from executive teams, you are going to have some really good ideas. You’re also going to have some bad ones, like anybody else. The best executives know the difference between the two. I’ve actively avoided institutional capital given our organic growth and ability to control our own destiny. But if 20 near death experiences in 10 days that lead to my pacemaker taught me anything – it’s that time is of the essence. We aren’t going to go on Shark Tank, despite the potential exposure – it’s not the right fit for our B2B model. But, we are going to find a partner/partners to make sure that we take advantage of the giant opportunity and we do it fast. Because the one thing I am sure of is that nobody is more prepared to tackle the problem of loss of identity and purpose post uniform or the challenge of hiring the right people for your organization than us. And if anyone else gets there first, the solution won’t be as great as ours is. #AllGasNoBrakes #DialedIn

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If you are a founder of a vertical software company - you should read this S-1! I first came across ServiceTitan back in 2016 while working at Bessemer Venture Partners. My former colleagues Byron Deeter, Kristina Shen and Talia Goldberg had just led the Series A financing of the company as part of the firm’s vertical software roadmap. Even back then it seemed like an exciting investment. Over the last eight years the company followed the Vertical Software Playbook to a tee, rising to a market leadership position, expanding its product suite to include services and fintech, and building a strong brand that every field service professional knows. There’s something interesting with timing of this IPO in a year that saw very little public-market activity for venture-backed companies. Financial geeks should pay extra attention to the untraditional compounding ratchet clause of its Preferred H Shares. Ultimately, it might’ve pushed the company to go public ASAP. If you’re too busy to read the full S-1, I suggest reading the wonderful S-1 Breakdown written by Alex C., Anthony DeCamillo and Austin Wang at Meritech Capital (link in the first comment). Congratulations and good luck Ara Mahdessian, Vahe Kuzoyan and team ServiceTitan!

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Valuations are starting to (only slightly) be in check. Investors looking for revenue, quality of revenue, margins, and repeatable GTM. This has the best founders focused on what matters, and reaching out to their Boards and advisors for real advice and guidance. Good stuff.

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Winning early GTM via founder led sales is an essential step in building a consequential start up. 🎯 But, while there are countless conferences focused on scaling GTM once you've hit a couple million in revenue, to date there hasn't been a conference focused on FOUNDER LED SALES and nailing the earliest days of GTM. 👀 😅 That ends now. 🙌 Pear VC has helped 100+ founders learn how to sell, how to build their 0-to-1 sales engine, how to get from $0 ARR to $1M ARR -- and now we're introducing the first ever GTM CONFERENCE for EARLY STAGE FOUNDERS. ⭐ "Zero to $1M: Winning Early GTM" will be held in San Francisco, CA this September 5th! ⭐ If you're at the idea 💡, pre-seed 🌰 , or seed stage 🌱 , this is the GTM conference for YOU. Come hear from Pear veterans, industry leaders, and successful repeat founders like Sanjit Biswas (Samsara and Cisco Meraki Co-founder and CEO), and leave with actionable guidance to supercharge your startup’s revenue from day 1. ​ ➡ APPLY NOW! Space is limited, and the early application deadline is July 15th. Pepe Agell and I will review applications on a rolling basis. 🚀 CANNOT WAIT TO SEE YOU THERE! 🚀 #earlystageGTM #zeroto1M #founderledsales

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📊 Founders, don't miss out on understanding your authorized shares. It’s not just about legal limits, but about saving significant tax dollars! 🎥 Check out the video and see how choosing the right method to calculate Delaware franchise taxes can benefit your startup. Link to the article in the original Kruze Consulting post. #Startups #VC #Finance #Taxes

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Valuations are a VERY intimidating topic for most Micro SaaS Founders / Sellers and Acquisition Entreprenuers. And rightfully so. There is almost no publicly available data to inform benchmarks and assumptions (think: what similar firms sold for and the performance metrics of those firms), and most deals come with unconventional deal structures (seller’s notes, earnouts, etc.). To make matters worse, other valuation methods rely on complex financial topics and require solid modeling skills. Oh ya, and the stakes are HIGH. For most, these transactions represent a life’s work or life’s savings. To demystify the topic, I'm excited to explain conventional valuation methods and discuss the challenges unique to Micro SaaS. Let's start with multiple-based valuations: Imagine you're valuing a house. You wouldn't just pull a figure from thin air. Instead, you'd consider similar properties, their sale prices, the size, the amenities, right? The same principle applies to multiple-based valuations – consider it the "real estate appraisal method" for businesses. For instance, you have a SaaS company earning $1 million ARR. Your industry's average ARR multiple is 2.5x. Your company's value? $1 million * 2.5 = $2.5M! Simple, isn't it? But, here's where we halt: DO NOT wholly rely on ARR multiples! Yes, ARR offers insights into growth potential and customer retention, but Micro SaaS is all about acquiring and growing profitable businesses to yield income. Hence, EBITDA multiples are your true marker. Be mindful, though, of limited public data, fluctuating market sentiments, and overhyped growth prospects—all these can sway your valuation, often unfavorably.

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