A valuation event is a company accomplishment or occurrence that can positively affect how investors, acquirers, or other evaluators value the company. It has no fixed dollar amount, but may influence the next financing, an exit, or the 409A process. section 20.1.2
Manageable valuation events include:
- Releasing a new product or a major product revision. section 20.1.2
- Signing a major or marquee customer whose reputation adds credibility. section 20.1.2
- Adding a meaningful partner that lends the company gravitas. section 20.1.2
- Completing new financing backed by professional investors who performed due diligence. section 20.1.2
- Hiring a major executive or board member with strong, relevant credentials. section 20.1.2
- Adding advisors with expertise relevant to the markets where the company operates. section 20.1.2
The practical goal is a steady rise in valuation rather than a sudden jump. A rapid increase can make a later down round more painful and demoralizing for the team. section 20.3
A manageable valuation path
A startup can build valuation momentum by combining a product release, a major customer, new financing, and stronger leadership or advisory expertise before the next financing or acquisition discussion. section 20.1.2 section 20.3
