Pre-revenue startups can invent valuations; revenue creates a strict baseline
Madison Wickham · Frat Guy Takes 2K a Month Side Project to 10Mil a Year Media Company, EP 286: Madison Wickham · Jun 14, 2016 · at 17:12
Grandex founder Madison Wickham explains the dynamics of startup valuation multiples before and after earning revenue.
0:00 / 0:13exact quote · 13.9s
720p mp4 · rendered on demand · StarZero watermark
“As soon as you start generating revenue, then it gives investors a metric to use as a basis for valuation prior to generating revenue. You can just totally pull numbers out of your ass”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Madison Wickham
Wickham in 2016: Instagram's algorithmic feed will destroy it for marketers
“And I guarantee you the right, I mean, the right is on the wall. Like it's gonna, it's going to, it's gonna just plummet as a platform for marketers.”
Wickham: Merchandise offers more control for niche media than digital ads
“And that really worked well. And it was something that we understood and felt like we had a lot more control over than Battling the extremely competitive and complex world of digital advertising. So we really gravitated towards merchandise and e-commerce and m…”
Wickham: Grandex raised its angel round at a $20M pre-money valuation
“It was, we raised it at a twenty million dollar pre-money valuation.”
Wickham: Grandex ran profitably for its first three and a half years
“For the first three and a half years, we ran the business profitably.”