I've seen many, many tweets hinting at how ridiculous seed stage valuations are these days. But as an entrepreneur it is hard to sympathize with these complaints.

I'm happy that my fellow founders are making out better than they used to! But is that a naive and ignorant stance? Should I care that valuations are insanely high?

I am more concerned about convertible notes than highly priced equity rounds.

Why?

I like aligned incentives. If I have stock in my company, I want my investors to as well.

Anecdotally I've gotten a lot more investor-help because of it.

The only downsides to higher valuations are that when you hire new people into the company, they need to be comfortable with the valuation and upside for them as well. It is sometimes tricky when raising the next round if there isn't enough progress, but if the rocket ship takes off, then it's good for everyone. I agree with Sahil on aligned incentives...

As I said before... I like aligned incentives. However there is a stigma that some attach to priced seed rounds. There really should be more objective education around the pros and cons of both.

Agree w\ Josh that its great if everything keeps going up quickly. But if you don't make enough progress between rounds to justify a higher valuation, then a down round becomes a nightmare.

I think the more important question is if sky high valuations indicate that we're in a bubble. For every Instagram, there are hundreds of startups that fail; if every one of those is getting high valuations then things will end badly for a lot of people...