How To Optimize Your Startup Financial Strategy
By siliconindia
Avoid Down Rounds At All Costs
A stage of venture capital financing that result in a lower company valuation is the down rounds. It may be due to the recession and plunging markets, management at many companies will have to decide whether or not to pursue a down round to raise additional capital at some point in the near future. If the company is not performing at its best, the sales and hiring is affected that damages the morale of the members. Sometimes, down rounds can be caused by raising unrealistic money at an unrealistic valuation that cannot be justified.