The Risk Factor Summation method is a common method used to evaluate pre-money, pre-sales companies. It provides a different perspective of how a business will do by looking at risk mitigation instead of trying to assume how a business will do. The first step to this method is the same as the Scorecard method. You need to find a baseline valuation for your company. To do this, find other companies with similar industry sectors, geographic area, stage of development, and bus

The Berkus Method for valuation is one of the simpler ways of evaluating a startup. It was developed and popularized by Dave Berkus, a longtime angel investor and author. One of the more interesting parts of this method though, is that while keeping the same base idea it’s been developed and refined over time. To evaluate, you score your startup on 5 categories corresponding to a number value up to 500,000. You then add it up to achieve your final evaluation. The 5 categorie

This method was first conceived in 2001 by angel investor Bill Payne. While there were many other valuation techniques that were being used to evaluate businesses at the time, this method stood out as it was specifically aimed at startups and looked at many different metrics. Many other techniques used metrics (internal rate of return, multiple on invested capital, etc) that wouldn’t be applicable to startups in their seed stage. This method uses an analytical way (with quali