When the valuation is based on investment by investors already in the deal... It does not imply that they think there’s a plausible path for the business to be worth the money.
As events have shown with WeWork, it implies that they are maintaining the façade for a little while longer while hoping o get to the point where they can unload the business onto the public markets.
Asking SoftBank what they think their investments are worth is like asking me what I think my house is worth. You Have to go by what arms-length investors are willing to pay.
I really think we need a new rule where nobody quotes a valuation if the last round involved existing investors and/or founders pumping up the valuation with additional investment.
As events have shown with WeWork, it implies that they are maintaining the façade for a little while longer while hoping o get to the point where they can unload the business onto the public markets.
Asking SoftBank what they think their investments are worth is like asking me what I think my house is worth. You Have to go by what arms-length investors are willing to pay.
I really think we need a new rule where nobody quotes a valuation if the last round involved existing investors and/or founders pumping up the valuation with additional investment.