The Startup Triangle includes Money, People and Technology. Slides include Founder's Equity, Vesting, Advisor, Seed Funding, Options and 409A Value, The Priced Round, VC Negotiations and Exit Value.

1. IRS Circular 230 Disclosure: To ensure compliance with the requirements imposed by the IRS, we inform you that any tax advice contained in this
communication, including any attachment to this communication, is not intended or written to be used, and cannot be used, by any taxpayer for the
purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to any other person any
transaction or matter addressed herein.
Startup Valuation:
What are you worth?
Palo Alto, San Francisco, Los Angeles
rroyse@rroyselaw.com
www.rogerroyse.com , ww.rroyselaw..com
@rroyse00 roger.royse

2. Roger Royse Royse Law Firm, PC
Palo Alto, San Francisco, Los Angeles
rroyse@rroyselaw.com
www.rogerroyse.com , ww.rroyselaw..com
@rroyse00 roger.royse

3. THE STARTUP TRIANGLE
PEOPLE
MONEY
TECHNOLOGY
2

4. FOUNDER’S EQUITY
 The Grunt Fund Method
 Equal Percentages
 Subjective
 Formula
3

5.  Who should vest
 How long?
 Acceleration?
 Change of control
 Termination without
cause
VESTING
4

6. ADVISOR
FAST Model
Valuation
Milestones and
Deliverables
Vesting Stock v.
Options
5

7. SEED FUNDING
SAFE Priced roundsConvertible Debt
6

8. 7
Do I need a valuation for my option plan?
RSUs and Restricted Stock
Phantom Plans
OPTIONS AND 409A VALUE

9.  VC or Institutional Investor
 Preferred Stock
 Valuation Methods
 Score Card
 Venture Capital Method
 Berkus Method
 Cayenne Calculator
 Risk Factor Summation
 Negotiation
8
THE PRICED ROUND

10. THE PRICED ROUND
 MoreValuation Methods
 (Patents + People) x $1
Million
 Comparable
 Discounted Cash Flow
 Market Multipliers
 Discount to Public
Companies
 Startup Factor Method
9

11. www.startuprounds.com
VC NEGOTIATIONS
 When to mention valuation
 Staged Investment
 Liquidation Preference
 Control
 Blocking rights
 Drags and tags
10

12. EXIT VALUE
11
Preferences
Earn Outs
Reps & Warranties
Taxes

13. CONCLUSION
Startup Valuation
is an Art
Not a Science
12

14. RoyseLink: Connecting founders with investors and
service partners.
Royse University: Providing business, tax, technology
and personal finance ideas to founders and executives.
Royse Law Legal Wizard: Offering legal document
templates and more.
Royse Law Incorporator: Incorporate your company the
Silicon Valley way.
13
RoyseLaw Incorporate.com
RoyseUniversity.com
RoyseLink.com
RoyseLaw Legal Wizard

15. PALO ALTO
1717 Embarcadero Road
Palo Alto, CA 94303
LOS ANGELES
11150 Santa Monica Blvd.
Suite 1200
Los Angeles, CA 90025
SAN FRANCISCO
135 Main Street
12th Floor
San Francisco, CA 94105
Palo Alto Office: 650-813-9700
CONTACT US
www.rroyselaw.com
@RoyseLaw