Category Archives: Option-Pricing Method
Rules of Thumb
Is there a rule of thumb for valuing common stock relative to preferred? If a new preferred round is priced at $1.00 per share, can we assume that the value of common is $0.10? No. By now, most managers of … Continue reading
Changes in the Value of Common Stock
One reason it’s difficult to value common stock in a venture-backed company is that the value of common is more volatile than the value of equity. A small swing in equity value, up or down, can trigger a much bigger … Continue reading