The Valuation dashboard provides you with an indicative value of your entity to support investor, partner and acquisition conversations. Valuations allow you to estimate the value of your entity using revenue, profit and EBITDA multiples as well as the net asset value method.

This feature automatically applies country—and industry-specific multiples based on analysis conducted by our corporate finance advisory team and incorporates actual market transactions. You may adjust your entity's inputs and our suggested multiples for an accurate, real-time estimate.

A business valuation is a process in which the actual elements of your entity are measured alongside its competitive position within its sector and its future financial expectations. This is necessary work because understanding your entity's value enables you to negotiate more effectively with potential buyers. Business valuation can also be used to determine taxation, establish partner ownership, and influence divorce proceedings for shareholders.

Navigate to "Analyze" > "Valuations" to land on the Valuation Dashboard, as seen in the image below. All revenue, profit, EBITDA and net asset values are automatically pulled from your financials for a 12 month period.

You can change the year that you are looking at within the global date selector at the top of your page to analyze the value of your business throughout the years, according to these four valuation multiples.

Create different valuations by making desired adjustments and clicking "Save Valuation" for future scenarios that your business may experience. Name your valuation and switch between different valuation scenarios that you have created by clicking the dropdown next to "Save Valuation". Adjustments to certain valuation multiples can be made by clicking "Adjust"; highlighted in the image above.

The revenue, profit or EBITDA multiple approach uses an entity's previous 12 months revenue, profit or EBITDA multiplied by a specific multiple to estimate the value of the entity. For example, if your revenue is $10,000 in the previous 12 months and your entity revenue multiple is 3, the estimated value of your entity is $30,000.

Multiples are based on the following inputs:

To arrive at a final multiple, we use the relevant multiple applicable to your country and industry and then multiply that by your revenue or profit growth rate. For example, if your country and industry multiple is 2 and your revenue growth rate is 10%, your final multiple is 2.1 (2 * (1 + 10%)).

Multiple values you can expect:

The Net Asset Value valuation is the simplest and most conservative method of evaluating your business. It is just the Assets less the Liabilities of your business, so, in effect, the value of the equity in the business.

This does not account for the future profits of the business or potential for growth in these, but rather just looks at the business’s value based on its assets and liabilities to date. This is a good metric to calculate to get a base value for a range of valuations.

To make an adjustment to your entity's revenue, profit, EBITDA, assets or liabilities; click on the "Adjust" button as shown in the image below. Once you click "Adjust", you will then be prompted to make an adjustment by amounts or by an account. Adjustments will always be present in a valuation you create unless it is deleted by clicking on the dustbin icon next to it.

If you select "Amount", you can then name your amount and enter a new value. You then need to specify whether you are adding or subtracting this value from the revenue, profit, EBITDA, assets or liabilities value. For example, Covid 19 was an adjustment added to the revenue multiple above.

If you select "Account", you can then select a category, account within that category, and whether to add or subtract it. For example, the Chocolate Sales account was an adjustment subtracted from the revenue multiple above. This could be because the business plans to stop selling chocolate and so adding this adjustment can indicate how this will affect the value of the business.

A valuation is important at any stage of your business because it prepares you for unexpected transaction triggering events. A transaction triggering event could be something such as:

Here are a few other potential use cases to consider:

When it comes to mergers and acquisitions, an accurate valuation provides a crucial perspective on the pricing of your business. In addition to this, if you are wanting to borrow capital for an acquisition or other business investment, it's in your best interest to have a recent valuation of your entity.

What if there's a shareholder or partnership dispute in your business? A valuation can also be useful in this case when it comes to arranging a fair settlement of ownership interest.

A valuation can help you to chart the course for the future by highlighting areas that need some development or attention, and any major shortfalls. If you perform this process regularly, you can use valuations as a measurement of your entity's progress over time. If you use valuations in tandem with your strategic business plan, you can start to see the ways in which you are meeting - or failing to meet - key objectives. Using key performance indicators (KPIs) as part of your valuation can help you identify gaps and problems.

ESOP is an employee benefit plan that gives workers ownership interest in the company which takes the form of shares of stock. When you know the value of your business, you can accurately determine the value of your employees' shares.

Valuations can help with litigation support for instances such as contract losses, divorce, embezzlement, executive compensation, partnership dissolution, SEC investigations, or shareholder disputes. In such cases, a comprehensive analysis of business value may be needed to reach a resolution.

​