Determining Valuation for Early and Latter Development-Stage Biotechnology Companies –

All biotech entrepreneurs at some point must address the question “how much is your company worth?” The answer determines the slice of equity for yourself, employees, and current and future shareholders.  As a result, most BioEntrepreneurs tend to overvalue their company at the start-up and early development stages.  However, overvaluing your company is counterproductive and detrimental to attracting institutional and venture capital during these critical stages.  Although there are standard valuation methods for determining the value of growing companies with product revenue, how do start-up and preclinical stage biotechnology companies without product revenue value their organization? (more…)