Estimate pre-money and post-money valuation for an early startup using revenue, growth, and market multiples. Use it to prepare funding scenarios and equity negotiation ranges.
The valuation estimate combines revenue scale with a multiple and growth premium. Early-stage valuations are subjective, so this should be treated as a negotiation range rather than a final price.
For idea-stage companies with no revenue, use milestone or scorecard valuation instead. Revenue multiple logic works best when there is recurring or repeatable revenue.
If ARR is $500,000, the revenue multiple is 8x, and growth premium is 20%, estimated pre-money valuation is $4.8M.
Investors often combine traction, market size, team, growth rate, and comparable multiples rather than using revenue alone.
Early SaaS multiples can vary widely. Use a conservative sector multiple unless growth, retention, and margins are clearly strong.
Multiply ARR by a relevant revenue multiple, then adjust for growth, market quality, and execution risk.
Pre-money is the company value before the new investment. Post-money equals pre-money plus the investment amount.
Yes, but the method should rely on milestones, team, prototype quality, market size, and investor demand rather than revenue multiples.
| Metric | Meaning |
|---|---|
| Pre-money | Estimated company value before the round |
| Post-money | Value after adding new investment |
| Investor Equity | Investment divided by post-money |