In early-stage startups, valuation is extremely vital in a number of aspects. Incentive plans such as employee stock options require a properly calculated valuation in order to determine the right compensation plan for early employees. Even more important is valuation in regards to fundraising as it is ultimately decisive for the equity given away in exchange for capital.

Yet there is no proven valuation model for early-stage companies. Our team developed a proprietary valuation tool for early-stage startups accounting for over 40 factors regarding team, product, market size, financials and other. The model turns data such as product development stage, competitive landscape, experience and industry knowledge of the founding team and geography (along with many other data points) into quantitative data which results in what we believe to be an accurate early-stage company valuation algorithm.

Please keep in mind that the tool is still being tested and works best for technological or tech-enabled companies.

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