VC Minute – quick advice to help startup founders fundraise better.
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When it comes to taking care of your team, this is something that I personally faced during the last round.
We were essentially evaluating a certain valuation range with our lead investor, and it was challenging because, at that point in the history of Rescripted, we had raised a few rounds, pivoted two times, and that cost more money. We have the goal of being profitable, which is not every startup’s goal. But it was our goal. And so, in negotiating with our lead investor, the valuation was really important to me and really important to my co-founders, and to some of our early employees.
Why is that important? The higher the valuation, the less you get diluted.
Most startups, especially if you’re raising money from venture investors and sophisticated angels, are eyeing an exit somewhere down the road. It goes without saying that you want this business to succeed; you know it’s going to succeed, and you have a lot of conviction that it will succeed. You want as much of a piece of the pie as possible.
I really found myself fighting from a valuation perspective, but that was after having a bit of comfort knowing that the investor wouldn’t walk away.
It was a smaller negotiation. This was an existing investor; they came in in a big way in the subsequent round, which was really exciting. It was just a matter of making sure that my team felt really good about this deal. And that the investor felt really good about the deal and really laid out the bounds before the term sheet was finalized.
Reaching 9M people monthly, Rescripted is the #1 global media platform for women’s health and fertility, providing content, tools, and resources for wherever you are in your reproductive lifecycle. Learn more at rescripted.com, and follow along at @hellorescripted on Instagram and TikTok.
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