How Each Valuation Method Works
Every figure below is an estimate. The price of a real round is set by negotiation, and these methods give you a defensible place to start.
Pre-Money and Post-Money Math
Post-money equals pre-money plus the investment. The investor owns the investment divided by post-money. Example: you raise €500K at a €2M pre-money valuation. Post-money is €2.5M, the investor owns €500K / €2.5M = 20%, and you and existing holders keep 80%.
Berkus Method for Pre-Revenue Startups
Berkus assigns a value to five things that reduce risk: a sound idea, a prototype, the management team, strategic relationships, and product rollout or sales. Example: €250K for the idea, €200K for the prototype, €250K for the team, €150K for relationships and €100K for early rollout adds up to €950K.
Scorecard Method
Start from a reference pre-money valuation for similar early-stage companies, then score yourself on team, market, product, competition, go-to-market, funding need, and other factors. A score of 50 means typical. Example: with a €2M reference and a weighted score of 62.5% against the typical 50%, the estimate is €2M x 1.25 = €2.5M.
Venture Capital Method
Work backward from an exit. Example: if you think the company could be worth €50M at exit and the investor wants 15x their money, today's post-money value is €50M / 15 = about €3.3M. Subtract a €500K investment and pre-money is about €2.8M. This method is only as good as the exit and return you assume, and it ignores dilution from later rounds.
What Investors Actually Look At
At pre-seed and seed there is usually little revenue to measure, so investors weigh other signals.
- The team: relevant experience, and why you are the people to solve this problem.
- The market: how large it could become and why now is the time.
- Early evidence: users, waitlists, pilots, letters of intent, or revenue if you have it.
- The round itself: how much you raise, what it buys in milestones, and how much of the company you sell.
- Competing interest: other investors in the round change the conversation more than any formula.
Seed rounds commonly sell roughly 10% to 25% of the company. Treat that as a typical range and not a rule.