ValuAdder Business Valuation Blog

Archive for the 'Company Valuation How-To’s' Category

There is one important attribute all early stage companies have in common: limited earnings track record. Young companies are usually busy trying to figure out the best ways to coordinate their key resources – labor, capital, and entrepreneurial skill to come up with a winning business model. If you need to value a young company,… Continue Reading

Valuation multiples lie at the heart of business valuation under the market approach. Each business is different. Yet businesses in the same industry group, of similar size and ownership structure may share a number of important factors that drive their value. If there are enough data on similar business sales, you can estimate the value… Continue Reading

One of the central business valuation techniques under the income approach is the discounted cash flow method. It lets you calculate the business value based on three fundamentals: Business earnings forecast, usually annual cash flows. Discount rate which captures business risk. Long-term business value, known as the terminal value. The standard discounting valuation formula assumes… Continue Reading

Of all the business valuation methods under the income approach the discounted cash flow technique truly stands out. What makes this method unique? Its solid financial foundation, flexibility in valuing established companies and startups, businesses with steady earnings and rapidly changing profits make this method an excellent choice for appraising all types of businesses. Earnings… Continue Reading

This is no idle question – with cyber attacks on the rise the safety and security of your business computer has never been more important. If you are a professional advisor, the last thing you need is to experience a computer crash in the middle of a time-critical project or sustain a loss of sensitive… Continue Reading

When it comes to valuing a business, size matters. The main reasons for this is that companies of different sizes face very different risks. Most investors believe that large companies are less risky than their small counterparts. Other things being equal, the smaller firms need to generate higher returns to compensate their investors for the… Continue Reading

One of the key factors that affects the value of a company is the industry in which it operates. So the question is why and by how much? The answer is risk. In fact, the industry-specific risk premium is one of the elements that make up the discount and capitalization rates for your business. And… Continue Reading

If you own a software firm, plan to start one or acquire an existing company, here are some interesting facts to consider: The two main segments of the software industry are custom software services and pre-packaged products. Software development services firms Classified under the SIC code 7371 and NAICS 541511, the firms in the software… Continue Reading

Need to know how to value a service business? To get a top quality business appraisal, consider using several well-known business valuation methods. Professionally prepared appraisals use several valuation methods. Be aware that each method represents a different view of measuring business value. So it’s a good idea to review the results from several different… Continue Reading

One of the most challenging tasks you are likely to face when considering an outside investment is how to determine the value of your company. Referred to by venture capitalists as the post-money valuation, this key step gives you a number of strategic decision data points: What the entire company is worth, known as the… Continue Reading

Are you using a modern 64 bit computer system? Or do you work on both 32 and 64 bit machines? Now you can use ValuAdder business valuation software on both types of computers – and get identical performance and accurate business appraisal results. What makes this magic possible? ValuAdder leverages the Java computing platform to… Continue Reading

Our customers ask us often: “what computer systems can I run ValuAdder software on?” Our answer: any computer you like! This is no exaggeration – you can conduct your business appraisal using ValuAdder software on all versions of Windows, Apple MAC OS, Linux or Unix computer systems. Industry-standard environment for business valuation software How is… Continue Reading

If you talk to a professional business appraiser, it won’t be long before you hear about the business valuation approaches and methods. These are the tools of the trade – and it is important to understand their relationship. Business appraisers enjoy having an arsenal of tools at their disposal. This gives them the flexibility to… Continue Reading

Of all the valuation methods out there, which ones are the best? The answer is it depends. If you need a sure fire prescription for an accurate, defensible business valuation, reach out for the business valuation methods the professional appraisers use. Each method has its own strengths and weaknesses. Because it reveals your business value… Continue Reading

If you are considering buying a small business or offering yours up for sale, the central questions are: What can the business sell for? How should I structure the price and terms of the deal? Valuing a business to estimate its selling price Not surprisingly, the business selling price is related to its value. Measuring… Continue Reading