Modeling in GE/VC
How does excel based financial modeling work in VC/GE funds? Spoke to someone at one of the "megafunds" in tech VC/GE and they alluded to the fact that its the least important thing and typically very very made up. Curios to hear of your thoughts.
Yeah, that is pretty accurate, my firm recently secured a term sheet throughout the process we were more interested in the stickiness of the tech, pipeline, TAM, to need fo the product, when it came time to do the valuation my Investment director kind of went well ARR has increased 40x, given that we can play around with the scenarios and see what the founder is looking for in his post-money valuation.
When companies are growing substantially it really is hard to accurately predict upside or downside. Put another way, if I asked what i banking analysts salary and expenses would be at 29, it would be very difficult and that’s essentially what you are trying to do. On the other hand, asking a 60 year old what their income and expenses are is pretty achievable.
As someone who doesn’t really like modeling / excel, but wants a lot of $$$, I find this appealing lol
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