Ask YC: I'm pitching to an angel. How do I value my startup?

Re:Ask YC: I'm pitching to an angel. How do I value my startup? by mig on Saturday January 19, 2008 @01:03AM (#100805)

$100K is not enough to sustain two employees for an year. $50K is less than the annual average living expenses for a person. (Just do the Math, housing, insurance, etc.). I would strongggggggggly recommend to try raising something between 0.75M an 1M. I have noticed a lot of fellow hackers seriously undervaluing the time they spend building a product. Two strong hackers, working for 6 months is eaily $140K expenses(and I am including just the salary an employer would pay). Please, please do not undervalue your time and expertise.

With the oncoming recession and all, you do want to have enough in the bank for at least 1 to 2 years, if you are serious about your startup.

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by jamiequint on Saturday January 19, 2008 @02:10AM (#100824)

$100k is more than enough to sustain two founders for a year. Especially if the founders happen to be young and unmarried. If they were living together they could probably make it on expenses of $50k for a year while still living relatively comfortably (even at Silicon Valley prices).

Also, I'm not sure what to make of your comment "Two strong hackers, working for 6 months is eaily $140K expenses" How good the hackers is hardly related to the expenses they require. Perhaps 140k is the opportunity cost?

Having enough in the bank for 1-2 years is probably a good idea, but it sounds like they could do that on $250k-$350k.

Also, I agree with matt, focus on the percentage you are giving away rather than the amount you want to take.

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by bayareaguy on Saturday January 19, 2008 @07:54AM (#100862)

At $50K your taxes are going to be pretty low, but just the same try and have the company pay for things instead of buying them with your salary.

If you look around you may find a business partner who could give you some money as part of some kind of deal. Traditional software companies can do this by pre-selling licenses at a discount and web companies looking for ways to get more users may pay you if you find a way to help your users get signed up with them. However I'd caution against spending too much time on this sort of thing yourself as it can easily become a distraction.

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by hacker64 on Saturday January 19, 2008 @01:43AM (#100817)

It's not easy, but it's doable. Asking for the numbers you're suggesting forces us to seek VC funding (which we might do later), but we're not ready for it yet.

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by nostrademons on Saturday January 19, 2008 @11:39AM (#100903)

Grad students routinely live on less than $20K/year...

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by far33d on Saturday January 19, 2008 @02:41PM (#100984)

they get insurance through school.

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by rms on Saturday January 19, 2008 @02:43PM (#100986)

you can get insurance for as low as $100/month...

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by wlievens on Monday January 21, 2008 @04:25AM (#101503)

Maybe this is a stupid questions, but aren't there taxes to pay as well? If they use the money to pay a wage to themselves (to use to pay for food and rent and insurance), then they pay income tax on that wage, right? Or does that "$50k" number include income tax?

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Re:Ask YC: I'm pitching to an angel. How do I value my startup? by tlrobinson on Saturday January 19, 2008 @04:26AM (#100843)

YC tends to gives about $6K-10K per founder, which needs to last for at least 3 months or until they get more funding, unless they have other funds... and the funded companies seem to make it work...

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