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Introduction
Overview Page

Preparing for your Journey
Figuring out where you are, where you're going and how to get there.

The Long Haul from
Zero-to-IPO

Roadmap and travel guide to the each of the four stages of growth.

The Short Sprint from
Zero-to-Asset Sale

Building a company to sell for a profit.

The Slippery Slope to Shutdown
Understanding how a cash crisis develops, how to raise funds, cut costs and avoid bankruptcy.

Valuing the Company
Figuring out what the company is worth.

Negotiating the Deal
Getting what you want through negotiation.

The Fundraising Process
How to raise funds from investors.

Selling the Company
The M&A Process: step-by-step guide to selling your company.

Every Journey Tells a Story
The various routes your journey could take.

Resource Guide
Directories of investors, advisors, agencies & other resources.

Valuing the Company watch movie | read endorsements


How do you put a value on a small, immature private company with virtually no financial history at all?


"Many of the valuation techniques that youíll find in the business school libraries today were formulated in the industrial age when tangible assets, like land, property and machinery, were relatively easy to sell and estimate a fair market value. Valuing bits and bytes, patents, expertise and ideas in the information age is not so straightforward. The balance sheets of information-age companies represent very little value if traditional valuation methods, like book value and liquidation value, are employed. Research and development costs are often expensed, and itís not easy to put a value on the real assets of the company, like intellectual property, customer base, distribution channels, sales leads, strategic alliances and staff.

Thereís very little to list in the asset column and the balance sheet has little bearing when it comes to finding the real value of a technology company today. However, there are a number of techniques available to value technology companies today. The easiest technology companies to value are.. "

This chapter identifies a number of alternative valuation techniques for technology startups in various stages of growth including:

  • Earnings multiple
  • Revenue multiple
  • Discounted cash flow
  • Build cost plus
  • Rule of thumb
  • Return on investment