Abstract
In the previous chapter, we discussed the consequences of overvaluing a company at the time of funding. However, company value can decrease from a previous round, even though the company was not overvalued at that time. This situation can occur when a company consumes massive amounts of money without reaching any new value-enhancing milestones. A biotech company’s value is closely tied to its product development progress; therefore, it is important to understand investor expectations at different financing stages. In this chapter, we review the typical funding stages for a biotech company, discuss valuations and how they are calculated, and review typical exit strategies for a company. Practical guidelines are also presented for writing a business plan, and tips are provided on making effective presentations to potential investors.
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Pricewaterhouse Coopers, “Growing Your Business: Is Going Public Worth it?”, March/April 2005.
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© 2009 American Association of Pharmaceutical Scientists
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Shimasaki, C.D. (2009). Financing the Company – Part 2: Funding Stages, Valuation, and Funding Tools. In: The Business of Bioscience. Springer, New York, NY. https://doi.org/10.1007/978-1-4419-0064-7_9
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DOI: https://doi.org/10.1007/978-1-4419-0064-7_9
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