This basic business valuator starts to give you a picture of what to expect when calculating percentage of the company you should expect to give away for the desired investment. The industry multiple will be what a like company is trading at or sold for recently over earnings (example, GOOG trades at about 70 times what it makes.) The Investor Required Return is how many times the investment the investor would like to get. Generally 50% compounded is standard for seed round risk, which is about 8 times their money in 5 years. So they give a buck, they want 8 back in 5 years.