Business Valuation Risk Premium Terminal Value 
Chris Mercer
MARCH 7, 2024
Procedural Guidelines (PG) are designed to provide more detailed guidance for consideration by business appraisers than found in the base standards themselves. Items on the list may or may not be applicable in specific valuation situations. The value of the underlying enterprise or asset, if applicable.
Valutico
AUGUST 10, 2023
Ultimately, valuing an SME demands a comprehensive approach that balances quantitative data with qualitative insights to arrive at an informed and defensible estimation of its worth. What is the basic idea behind valuation?
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Valutico
SEPTEMBER 13, 2023
SMEs can present challenges with DCF due to limited historical financial data, unreliable information, inadequate financial forecasts, and difficulty in determining terminal value. Approximations, negotiations, and considering illiquidity premiums help mitigate these challenges. What is the Basic Idea behind an SME Valuation?
Equidam
APRIL 22, 2025
10] , [23] , [2] Discount Rate: The rate used to discount future cash flows is typically the cost of equity, calculated via the Capital Asset Pricing Model (CAPM): Cost of Equity = Risk-Free Rate + Beta * Market Risk Premium. [23] 28] This approach suits companies expected to mature into stable, ongoing businesses.
Equidam
APRIL 22, 2025
” [1] [2] [4] [15] [19] It estimates a future exit value (often based on projected earnings and industry multiples) and works backward, using the high ROI targets VCs require (due to portfolio risk), to determine what the company could be worth today to justify that future return. [15] How to Value a Business (Equidam Blog).
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