Worthworm Tutorial: Calculating Your Pre-Money Valuation

Calculating Your Pre-Money Valuation

HELLOWorthworm takes the guesswork out of pre-money valuations (PMV) with sophisticated strategic analysis tools that are designed to provide a stronger, more credible starting point for investment negotiations between entrepreneurs and angel investors.

INTRODUCING WORTHWORM

STEP 1

To create your first venture, click the tab that says, “Step 1 | Create New Venture.” You can have multiple ventures, but we recommend starting with one.

CREATE A NEW VENTURE

STEP 2

Once you’ve created your venture, you can create models to test how different business factors and decisions could affect your PMV.

To create a model, click the tab that says, “Step 2 | Start New Model.” Type the name of your model into the open box, and click “Save.” (Don’t worry, you can always change the model name later.)

START A NEW MODEL

STEP 3

Your PMV calculation starts with a guided questionnaire that includes more than 70 questions focusing on key valuation drivers of your business.

Your answers power Worthworm’s sophisticated algorithms, which provide a sound, defensible PMV and help you think through vital questions that contribute to your venture’s success.

COMPLETE QUESTIONNAIRE

STEP 3

Here’s how to complete the questionnaire:

1. Go through the questions about 9 aspects of your business, selecting the answer to your question on the left and your confidence in that answer on the right (if requested). You can start and stop at any time if you don’t know the answer to a question or want to come back to it later.

COMPLETE QUESTIONNAIRE

STEP 3

2. When you’re done with a section of questions, click “Continue” at the bottom of the page to move on to the next section.

3. Once all of the sections have been completed, click “Calculate” to calculate your estimated PMV.

COMPLETE QUESTIONNAIRE

STEP 4

Your answers go through an algorithm that uses almost 1,100 analytic parameters and over 4,000 outputs, blends the most respected valuation methods, and compares your ventures with third party research about companies at the same maturity level.

The result is a credible estimated PMV that any investor or entrepreneur can feel confident sharing and defending.

CALCULATE MY PMV

STEP 4

Click “Step 2 | My PMV” to see your PMV displayed on a valuation bar with an arrow.

The arrow indicates your current estimated PMV, and the valuation bar illustrates how much higher or lower it could be based on operational and other risks, including the levels of confidence you expressed while answering the questionnaire.

UNDERSTANDING YOUR PMV

GET STARTEDReady to calculate your venture’s PMV and learn the best ways to maximize it?

Follow the steps in this tutorial, and get in touch if you have more questions or feedback.

[email protected]

888-429-2530

USE WORTHWORM TODAY