1
Qualitative Valuation Methods
The Average (required for Scorecard valuation) and Maximum (required for Checklist & Stage valuations). This approach determines the pre-money valuation of the target company by comparing it to similar angel-funded startups. The median and maximum valuations of recently funded companies in the region are adjusted and considered. However, it is important to note that such comparisons can only be made for startups that are in the same stage of development, specifically, those that are pre-revenue or have only minimal revenue. The data for these startups was obtained through CrunchBase, which is one of the largest global data platforms for startups.
2
Venture Capital Method
The Venture Capital approach values pre-revenue companies based on predicted exit value after reaching milestones within 3 to 7 years. The ROI considers the investment yield and risk. We obtain data through Capital IQ, a global company information repository.
3
Market comparable and Transaction Methods
Valuation can be done using market comparable or comparable transaction methods that rely on key ratios and multiples to estimate a company's worth. These methods are for established, profitable companies and use data from Capital IQ.
4
Discounted Future Cash Flows
The discounted cash flow (DCF) method evaluates an investment's value based on expected future cash flows, applicable to financially stable companies. To calculate ROI, expected return and risk for a mature company in the industry are considered. Data for startups is from Capital IQ.
5
Replacement Method
D-One's business valuation tool uses 8 best practice methodologies for startups and 5 for established SMEs, with each methodology tailored to different business stages. We apply a weighted average matrix to represent a business's growth stage to ensure accurate valuation estimates.