Valuation

You built this for years. If you were to sell tomorrow, do you know what they would tell you it is worth?

Most owners overestimate, or underestimate, their own business.Knowing the real number, and what makes it rise, changes how you decide from here on.

Does this sound familiar?

And no, it is not just you. Almost every owner whose company grew has been through at least one of these.

  • You have never put a real value on the company, just a guess.
  • A buyer shows up and you do not know if the price is fair.
  • You want to bring in a partner or investor, but do not know what the stake is worth.
  • You feel the company is worth more than the numbers show, and cannot prove it.

The Cost of Waiting

Every company is valued one day. The difference is whether you arrive prepared or caught off guard.

  • What you do not fix today becomes a discount at the negotiation table tomorrow.
  • Owner dependence, loose numbers and lack of predictability pull the value down.
  • Those who only discover the value when selling almost always find a number lower than they deserved.

Why It Happens

Company value is not how much you would like, nor how much you billed last year. It is how much it can generate from here on, and how much of that is predictable. Most businesses are worth less than they could for reasons that can be fixed: owner dependence, poorly demonstrated profit, lack of predictability. Those who do not know this leave money on the table right when it matters most.

What We Do

First we put a real number on your company, with method, not guesswork. Then we show what is pulling that value down and what can be adjusted before any sale or fundraising. If and when you decide to sell or bring in a partner, we lead the negotiation from your side of the table.

It is valuation and M&A for what they really are: the realization of the value you took years to build.

Let’s start with the diagnosis

"Company value is not intuition or emotion. It is what the numbers prove. We calculate it with method and show what to do so that number rises before any negotiation."

The Value Bridge Why a company’s value is almost never on the balance sheet MVA · Market Value Added Recordedequity Book Value of Capital + Asset Revaluation + Identifiable Intangibles + Goodwill & Future Flow TOTALCAPITAL = Total Capital at market value − Net Debt EQUITYVALUE = Equity Value ↑ this is where DCF comes in Conceptual structure ref. Mercer (2015) · illustrative proportions · Advisor.Tips adaptation
The Advisor.Tips Valuation Method Approaches selected case by case, validated by triangulation, scenarios and simulation INITIAL DIAGNOSIS FORMAL PRESENTATION INPUTS 1 Income statement3 years actual + projectedBalance sheetcurrent + projectionsDepreciation & AmortizationCap tableFunding roundsProvided by the company,not audited. ASSUMPTIONS 2 Projection period3 to 10 years Discount Rate (TDe) TDe = Rf + β × PRMRf · BR 10y Treasuryβ · sector / emergingPRM · ERP BrazilEV / EBITDA multipleLT growth · IBGESurvival rateIlliquidity discountRequired ROI · risk CONSOLIDATION 3 EBITDA Operating revenue− Cost of sales− Operating expenses+ Depreciation+ Amortization= EBITDA Free Cash Flow ± Interest · − Taxes± Working capitalReceivables · Inventory · Payables− CAPEX+ Future funding= Free Cash Flow APPROACHES · IPEV 4 Examples, not fixed,chosen case by caseVC MethodIRR-basedDCF GordonFCFF / WACCDCF Exit Multiplefundamentals-basedFCFE Risk BasedEquity / KeBook Valueand others, as needed WEIGHTING 5 Weighted average of theapplicable approaches Ex. Startup more weight on riskand exit potential Ex. Mature company more weight on cash flowand predictability VALUATION RANGE 6 Weighted sum (Σ)Range: 90% to 110% × Σfloor and ceiling of valueThe result isa value range,not a single number. Every calculation above goes through a layer of validation and risk control THE RELIABILITY FOUNDATION OF THE ADVISOR.TIPS METHOD what makes the valuation defensible, not empirical SANITY CHECK Triangulation of equity values FIRST CHICAGO METHOD Probabilistic scenarios SENSITIVITY ANALYSIS Weight of each assumption on value MONTE CARLO SIMULATION Stochastic assumptions Advisor.Tips Calculation Guide (Sep/2023) · IPEV guidelines · methodological representation
A direct question

Do you know what your company is worth today? Not what you imagine. What a buyer, a new partner or a bank would actually calculate. Knowing the real value changes how you make decisions. That is what we want to talk about.

Calculate my company’s value

Not quite it? Is your problem another one?

Unlock your business’s potential.

A diagnosis conversation already shows where the bottleneck is.