How is the valuation of the startup determined?

A company will typically come to FundersClub with a desired valuation or set of terms. In many cases, they have already raised capital from offline investors on these terms, and wish to extend those same terms to FundersClub. In all cases, FundersClub will vet the terms offered by the company with its Investment Committee, and typically with the FundersClub Panel, which is a select group of members, and determine if these terms are reasonable to potential investors before we invest under those terms. Startups are hard to value and there's no guarantee that the valuation will be "correct."