Your valuation to be offered on Crowdcube must be set on a fully-diluted basis. This means taking into account the fully diluted share capital of the Investee, including all share options (granted or available); warrants; convertible debt or any other convertible securities; and any other right to acquire shares. This means that the percentage of equity offered to the crowd will not be diluted by any existing options (granted or available), warrants or convertibles.
There is no right or wrong way to value a business. Unfortunately, it’s highly subjective and the ways of valuing a business have been widely debated.
As a starting point, we suggest looking at similar businesses in your market to see how they’ve been valued. As well as the sector, you’ll also need to take into account the stage and growth of your business.
Whilst we do not offer advice on valuing your business, we recommend remaining conservative. The lower your valuation, the more potential upside for investors, and the greater interest your pitch will receive. You’ll also need to consider how your valuation may affect future funding rounds, as overvaluing your business may make future funding rounds more difficult.