The valuation of a start-up refers to the estimated value of the company at a specific point in time. It plays a particularly important role in funding rounds, as it determines what share investors receive in return for the capital they have invested.
As start-ups often do not yet have a long track record of turnover or profits, their valuation is usually based on a combination of various factors, including:
- Market potential and growth opportunities
- Business model and scalability
- Technology or level of innovation
- The founding team’s experience and expertise
- Revenue to date, customers or market traction
- Competitive landscape and market position
The start-up valuation serves as the basis for negotiations between founders and investors and has a significant influence on the ownership structure following a funding round.
As determining a realistic company valuation is often a complex process, start-ups should be able to clearly set out their market prospects, key performance indicators and growth strategy. innoWerft supports founders in further developing their business models, defining relevant key performance indicators and preparing professionally for meetings with investors and potential funding partners.