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Valuation of startup and emerging companies with most having negative cash
flow in early stages with significant projected rewards later is very difficult task.
Yet investors are confronted frequently with investments whose current value
must be estimated in spite of the fact that much of the reward lies in future.

Following are some of the most commonly used methods for valuation of startup
and emerging companies. There are various different approaches to
estimating the value of a startup company.

Income Approach: Estimating future cash flow that could be taken out of the
business without impairing future operations. Most common methods in this
approach are: Net Present Value, Equity Cash Flow and Capital Cash Flow
(Adjusted Cash Flow being a variation of this method).

Market Approach: Estimates the value of a going concern business by comparing
to similar firms whose stock is publicly traded. In many cases Market Approach is
used as a secondary valuation method to verify the estimates derived from the
Income Approach.

Asset Approach: valuation based on the firm as a financial option.

 

Valuation Calculators (Calculator Disclaimer)

Future Value Calculator
Number of years to exit
Investment	$
Rate of Return	%

Present Value Calculator
Number of years
Future Value	$
Interest Rate	%

 

Expected IRR Calculator
Number of years to exit
Investment	$
Value of Investment at termination year	$

 

Simple Pre-Money Valuation
Number of years to exit
Future Value Discount	%
Post-Tax Profit Margin	%
Estimated PE (Price/Earning) for selected Industry
Expected Revenue on Termination year	$

 

Simple Ownership Calculation
Number of years to exit
Initial Investment	$
Require Rate of Return	%
Post-Tax Margin	%
Estimated PE (Price/Earning) for selected Industry
Expected Revenue on Termination year	$

Calculator Disclaimer

Calculators are provided as a free service to our users. No guarantee, explicit or implied, is made regarding their accuracy or suitability to a specific purpose.

The result of this calculation should not be taken as a statement of the facts, but rather a general guideline of industry practices. Furthermore, the results shall not be construed as any recommendation, under any terms, to any individual. Use of any tool on this site shall constitute acceptance of the terms of this agreement.

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