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What are the main factors that are considered to determine the valuation of cloud startups?

Please mention the factors and industry standards to determine valuation of a startup in a cloud business.

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Arthur Lipper
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Arthur Lipper Entrepreneur
Chairman of British Far East Holdings Ltd.
Assuming the ability to produce an end-product, the scope of the early demand for the product or service.
Gary Hare
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Gary Hare Entrepreneur
Consultant - B2B eCommerce, Spend Management
Comps (comparisons). Take valuation and annual / trailing sales of public and private companies in your market segment.Calculate the price to sales ratio (valuation divided by annual / trailing sales) for each company. If there are recent private company exits, or private equity buyouts in your segment, note the price to sales ratios at the time of the transaction. Average the ratios, and apply to your own sales numbers, and you have a valuation. Of course, this is not a perfect approach, but at least its based on data, versus subjective opinions.
Arthur Lipper
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Arthur Lipper Entrepreneur
Chairman of British Far East Holdings Ltd.
Why focus on valuation? It is better to get the money by selling a percentage of future revenues and none of your ownership. See www.Royalties.Website
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