Business Valuations -Great Works of Fiction

I was asked recently to do a valuation for an early stage tech company. My first reaction was positive – I haven’t done valuation work in while and I kind of miss it. Then I got into the exercise and remembered why I gravitated away from this work.

For those new to this concept, valuations are spreadsheet based analyses of a business that yield a market price for the sale of the business (or a percentage thereof). There are lots of ways to value a company such as through the use of comparables, by applying multiples to key balance sheet and income statement items, developing outcome probabilities, discounting future cash flows and many permutations on each of these.

Gary Bloomer

Full Story: http://www.techranch.org/blog/2009/08/business-valuations-great-work.php