Company valuation basically includes the following steps:
# Investor looks at money to raise
# Investor looks at required rates of return given the investment stage:
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# By looking at the required rate of return the investor calculates what he wants his money to be worth in year 'n'
# Then by looking at the projected value of the company from the business plan, the investor calculates what percentage of the shares he then would need.
# Then the share price can be calculated from the # shares and the original required investment.
Session audio:
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Process explained in [[this|/static/files/MBI/Module%2010/Company%20valuation.xlsx]] spreadsheet (picture below:
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Company valuation 'rules of thumb'
|Type of business|Formula|h
|Retail|3 times sales|
bag
mbi_public
created
Sat, 06 Nov 2010 14:00:33 GMT
creator
dirkjan
modified
Sat, 06 Nov 2010 14:00:33 GMT
modifier
dirkjan
tags
M10
Term
creator
dirkjan