What is the average valuation on an Indian startup with beta product, pre-launch stage, pre-revenue stage?

(This was my response to a question on Quora)

Depends on several factors… could be anywhere between INR 2-5 cr.  – 5cr. (i.e. USD 350,000 –USD 800,000). 

Valuation range will largely depend on the following factors:

  • Who is doing it : Team – if it is a bunch of college students with no prior business or work experience, it will be in the lower end of the range… if it is a team of experienced professionals or entrepreneurs, it is likely to be at the higher end of the range. Of course, if it is a team os super-star, proven entrepreneurs/professionals with significant domain expertise and experience, the valuation could be much higher…. and actually may not be an angel round.
  • Size of the opportunity: Larger the opportunity, higher the valuation.
  • Does the product/service have a reasonable chance of dominating that market: If the answer is a resounding yes, the valuation will be higher.
I must add here that, if the opportunity is large and the team is competent and committed, the chances of getting funded are higher even if the product is not great. On the other hand, even with a great product and a large market, if the team is weak, they are unlikely to get funded.

Author: Prajakt Raut

Prajakt Raut is the founder of Applyifi.com, and author of the book for startups - ‘Starting Up & Fund Raising’ Prajakt personal goal in life is to encourage and assist a 100,000 people to become entrepreneurs. _____________ Prajakt is the founder of Applyifi - an online platform that provides startups a 36-point scorecard and assessment report on the venture's investment readiness [www.applyifi.com], and helps them improve their odds of getting funded. Prajakt is also the founding partner of The Growth Labs, a platform where growth-stage companies get sharp, incisive advice from senior professionals and experienced entrepreneurs. [www.thegrowthlabs.in] Before starting Applyifi, Prajakt was the head of operations at IAN, founding member of a leading incubator, and the Asia-Director for TiE (2004 - 2007). Previously Prajakt had co-founded Orange Cross, a healthcare services company, and was part of the founding team member of Idealake Technologies. While in college Prajakt had founded a printing business and has spent over 10 years working in leading advertising agencies. Prajakt’s book, ‘Starting Up & Fund Raising’, helps startups understand an investor’s perspective, and helps them improve their odds of getting funded. The book also helps entrepreneurs understand the building blocks of a business.

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