Please comment if you know your stuff.
If a startup raises 100M and is valued at 2B, then the rest of 1.9B is actually not backed by real money. The real money is 100M. (Assume profit cancels out operating cost)
If that startup goes IPO at 2B, and the public puts extra 100M, then the sum of the money that went to the startup is 200M but is valued nearly at slightly above 2B.
So essentially, market cap != real money.
Now, if that startup wants to be valued at 5B, does it actually require investors to put “actual” money worth of 3B?
Or is it possible that market cap reaches 5B without the real money going in once in public
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I'd suggest researching how public company valuations are done; check out investopedia and google around as starters (ex. discounted cash flow and industry comparables). After that, read up on the private company and SaaS side in particular because they're done very differently from other industries. It can be risky for your personal finances/expectations if you're in this space without that knowledge; you won't know what equity numbers are reasonable and what numbers are moonshots. Startups are even harder to value because of how fragile they are.
It is more complicated than this because investors especially early stage ones enjoy other benefits but basically this.