' Come For An Investment Round Only When Your Startup Is Earning Revenue '
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
Amidst all the thing startups remember to cover when approaching an investor, one thing they tend to forget about is their revenue. But it is this revenue that brings them their desired valuation.
The Vault, by Jatin Goel is an investment platform that offers upcoming entrepreneurs a chance to showcase their innovative ideas to industry veterans and fund their ventures.If you ever dreamt of getting funded on the spot then this place is for you.
Entrepreneur India caught up with Sudip Bandyopadhyay, Group Chairman, Inditrade Capital who was responsible for the acquisition of AMP Sanmar through which Reliance launched its Life Insurance business. His leadership helped Reliance Money expansion in India and across the globe.
In a candid chat, Bandyopadhyay gave tips to startups on achieving better evaluation.
"As far as a startup is concerned it's extremely important that they are earning revenue and they have revenue. Therefore, the pre money start-ups never attract good valuation, whereas the post money start-ups always give more confidence to the investors and attract better valuation . So my suggestion to the entrepreneurs would be to come for an angel round or ABC round once your company has started clocking revenues," he said.
Right Time For An Investor To Exit :
When asked about the right time for an investor to exit, he said “The exit of an investor completely depends on his/her time horizon. He has to decide whether the valuation is appropriate for his exit which to my mind will depend on what is the roadmap for the startup he envisages going forward,”.
To know what Bandyopadhyay has more to say on the valuation of startups, watch the video.