With all respect to Dan, I'm not seeing anything like that.
You said "pre-revenue." If it's pre-revenue and enterprise, you don't have anything proven yet. You would have to have an insanely interesting story with a group of founders and execs on board with ridiculous competitive advantage built in.
I have seen a few of those companies. It's more like $3m-$5m pre.
Now, post-revenue is different. I've seen enterprise plays with $500k-$1m revenue/yr, still very early (because in the enterprise space that's not a lot of customers yet), getting $8m-$15m post in an A-round.
I do agree there's no "average."
Finally, you will hit the Series A Crunch issue, which is that for every company like yours with "cutting edge tech" as-yet-unproven, there's 10 which also have cutting edge tech except they have customers, revenue, etc..
So in this case, it's not a matter of valuation, but a matter of getting funded at all!
There's so many variables to consider but let me provide some general rules of thumb.
Average I'm seeing is around $12M Pre-Money for a series A. That's considering
- Strong team (technical, ux, startup experience)
- DEEP tech (no first client usually means it took a while to build and should be super interesting and deep.
- Notable existing investors (TechStars/YC, FirstRound, Dave McClure, etc)
- San Francisco or NY
If you don't have any of those, then I would subtract $3M per.
Honestly, I haven't seen any startup recently raise a decent Series A without a strong customer base to prove there's a real need in the market.
Product & Distribution is key.
I'd agree with Jason. Early, aka pre-revenue, it is more a function of the venture math. Generally, it about how much capital does a startup need to prove a thesis. Over time this feels like $500k-$1MM at the seed stage. Using basic venture math from an institutional investor of 25% ownership in the company. That puts the company at $2-4MM pre-money valuation.
It changes post revenue, not post consulting revenue, it needs to be revenue that demonstrates a valid hypothesis about the Customer Acquisition Costs (CAC) or the Customer Lifetime Value (CLTV). Targeting $50k/month and the valuations starts to go up. But this looks like an Series round with a much higher valuation $8-12MM pre-money (maybe higher - depending on team, market and other factors).
The "enterprise" thing is less important. What I want to know is how well you know your potential customers, how full is the top of your funnel, what are the decisions that a buyer makes at each stage of the funnel, and how many prospects are at the different phases.
I believe that you shouldn't be looking for the "average" amount for a round of funding, but rather- what you need to get the product done and get traction.
Going right to series A without a client or traction is going to be really hard.
Starting with a smaller seed round is a safer bet and then you can segway that into a larger round a few months later.
I have backed many startup companies, at first round/seed stage premoney valuations ranging from under $1 million to over $25 million. Some companies formed by superstars get much higher valuations than that. Some companies rely on angels to set the early valuation, which is a little like asking a customer how much they want to pay for your product. Other companies sell enough SAFE to get to a viable product and revenue and then rely on a competitive process with professional investors to set the Series A valuation. If you would like to discuss this further please feel free to get in touch with me.