How startup valuation multiples actually work
Why two companies with identical revenue can be worth $40M and $400M, and what a revenue multiple is really pricing.
6 min read
The mechanics inside Garage to IPO are simplified versions of how startup finance actually works. These guides explain the real concepts behind the numbers on your dashboard — what a valuation multiple is pricing, why runway is measured in months, what an option pool quietly costs you, and what changes the morning after the bell.
Why two companies with identical revenue can be worth $40M and $400M, and what a revenue multiple is really pricing.
Gross burn, net burn, and the difference between a company that is spending fast and a company that is dying.
Owning 12% of a large company beats owning 100% of a small one — but only if the rounds in between were priced well.
Every round answers a different question. Knowing which question you are being asked is most of the preparation.
The bell is a starting gun. Guidance, quarterly reporting, buybacks, and a board that can now be replaced.