1, Business valuation according to the asset approach
We only offer this for
A, Solopreneurs (companies with only one employee)
B, Holding companies
C, Companies that solely owns commercial property. A separate commercial property valuation will be subcontracted by us.
2, Uncomplicated business valuation without consulting
A business valuation is typically but not always uncomplicated, when the business has been around for a few years, and the profitability is somewhat steady and aligned, between the fiscal years. The the financal statements (US) or final year end accounts (UK) must also be in order. The valuation methods used, are the asset approach in combination with the income approach.
3, Complicated valuation with consulting
Here, there are no limitations of how complicated the valuation can be, and unlimited consulting is included, but the consultation is limited to the valuation. Companies who do not have their financial statements in order and companies that are involved in lawsuits, do fall under this category.
4, Tech valuation
Valuation of tech companies, such as Saas (software as a service), digital platforms and other digital companies. E-commerce are often, but not always, defined as a traditional company. Tech company, can also refer to medtech companies and other industries.
What we do not offer
A, We do not offer valuations of restaurants and smaller stores etc, according to the market approach. However, we do offer our services to larger companies in these industries, with what according to us is the correct methodology, ie, several valuation methods combined, and normalized financial statements.
B, We do not offer valuations of pre revenue companies, and we do not offer valuations for fundraising purposes.
The two most common forms of due diligence are the following:
1, Legal due diligence is about reviewing the company’s contracts and any liability. The larger the company, the larger need for legal due diligence.
2, Financial due diligence is about confirming that the company’s finances are what they are claimed to be.This is the most common form of due diligence, which is always done regardless of the size of the company.
3, Forensic accounting, is basically the same as financial due diligence, but with more focus on criminal elements, such as money laundering etc.
The above is and should be considered standard for all transactions. Under extraordinary circumstances, the down below forms of due diligence can also be required.
4, Commercial due diligence is about market research etc. We rarely consider this to be relevant for traditional companies, as the quality of the data often is good enough to base deceisions on. However, there may be exceptions such as when it comes tech startups.
5, Technical due diligence is about inspecting the condition, of the company’s assets. It can be anything from IT systems to excavators. We consider this category to be important and that it should be given adequate priority.
Received an offer for your business, containing complicated terms? We help you navigate the jungle, which can include:
* Negotiation support regarding the valuation
* Seller liability post transaction
* Earn out
* Seller financing
* Payment terms
* Conditional down payment
* Unconditional down payment
* Exit planning, how to increase the value of the business
* Non compete agreements
* Vendor due diligence and regular buy-side due diligence
Business valuation is the process of determining the most likely value of the business, in a transaction, where both parties are equally motivated to transact. A qualified valuation of a business should be according to the concept of intrinsic value and include an unbiased normalization of the financial statements. The final calculation of a business appraisal is fairly simple and quick, which is typically what you only get, when ordering an online valuation, without an on-site visit. The process of normalizing the financial statements along with weighing in the different valuation methods against each other, is what requires the most amount of time and competence, by the business valuator. The normalization of the financial statements is typically what affects the valuation the most. A company valuation should only be considered as reliable when it is properly independent and unbiased.
The most common methods for valuing a company are; the market approach, the income approach and the asset approach. They all have their strengths and weaknesses, and their own subcategories. No valuation method is complete enough, to solely be used to value a company.
The market approach doesn’t properly weigh in the profitability or assets of the company, which arguably are the most central aspects when valuing a business. Therefore, most valuations according to the market approach, are not of intrinsic value.
The income approach doesn’t take the assets that the company owns, into account. Therefore, companies with lots of assets get deceptive valuations.
The asset approach doesn’t take the profitability into account. Therefore, profitable businesses get deceptive valuations.
Want to go with a cheaper option or even do the valuation yourself? Nothing is stopping you, but...
You may lose the lawsuit, due to the valuation failing to be waterproof.
You may never settle the conflict, hurting the relationship with your counterpart.
You may get deceived while entering or exiting your partnership.
Tell us how we can help you
We don’t work with cash intensive businesses that are small and local. We also don’t work with pre revenue tech startups or fundraising. Our price range is roughly half of what the big four charges. We have an anti corruption policy & 100% money back guarantee, if our valuations would not win in court.