My guess is, if the number truly is a simple, round $500m … then Handy just set a price. And waited.
Valuations certainly can be a very “hard science”, quantitative exercise in start-up investing, no doubt. Especially when a start-up with real revenue is actively seeking investment and needs it.
But …
When a company either is Hot and doesn’t need the money, or sometimes, if it’s Hot and playing as if it doesn’t need the money … then often, the start-up just sest a price when the suitors come by. And waits.
Maybe it’s 2x the last round, with a large addition to the pool. Maybe it’s 2.5x the last round.
Maybe it’s Half a Unicorn.
I dunno.
But the Hot ones that have tons of runway often set a price to the suitors that come by.
And just wait. And see who bites.
…
Follow this strategy at your peril if you aren’t Hot enough, however. Or don’t have enough runway.
