VC “Magic Ratios” Revealed

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

Today I came across a blog post by Steve Barsh in which he posted his slide deck from a talk he’s gave in SF recently.

Flipping through the deck, I came across one of the most straightforward and insightful presentations of the numbers that a VC is basing investment decisions on, often called “magic ratios.”

If you are trying to raise $2 mil from a VC at a $5 mil valuation, you will need to be able to show a path to a $100 mil exit in 5 yrs to show a 10x return assuming 50% dilution through future rounds.

The implication of this is very clear. It’s easy to talk about raising $2 mil, but you need to be focused on whether there is an exit for your company at $100 mil, and how you are going to get there. That’s what your VC is thinking about.

Check out slide 4 of the slide deck embedded below. Thanks for the insight & clarity Steve.

Announcing: Voodoo Pods – Shared Office Space

sxsw 757 st charles 051Looking for office space? Want to work in a creative environment with other startups?

Voodoo Ventures lives in a bright, airy office space on the third floor of a historic brick building at the corner of St. Charles & Julia. We’ve been here for a year now, and we’re ready to share our turf. Our vision is a shared, creative work environment for several 1 or 2 person startups all benefiting from each others’ expertise. A startup lab with shared resources and a lot of energy and fun.

We’ve got two offices pods available. You get a private office all your own with a door you can close. The available pods are:

  • Julia St. Facing – 12′ x 15′ rented!
  • St. Charles Facing – 12′ x 12′ rented!

And we all share the following:

  • Reception area & kitchen
  • Conference area with whiteboard & 42″ plasma monitor
  • Wireless internet & shared land-line (or you can install your own)
  • Laser printer, color printer & fax
  • Outdoor deck for lunch & Mardi Gras

Wanna see what it looks like? Here are some pics and a video:

Each pod is available on a month-to-month lease for $600.

We’re looking for the right startups to fit the group enviroment so please email all your relevant info to cschultz@voodooventures.com.

« Older Entries