September 10, 2025·
post
Think of startup valuations like credit card limits. Higher income usually gets you a high…
Think of startup valuations like credit card limits. Higher income usually gets you a higher limit but once you have a high limit, people assume you must have higher income.
Same circular logic applies here: valuations are just a proxy.
Founders and VCs negotiate how much money is raised at what % equity, and then flip that into a “valuation".
It’s math on paper, not proof of fundamentals.
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