Fundraising Valuation Report

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A Fundraising Valuation Report serves a distinct purpose compared to a traditional Business Valuation Report. While the latter focuses on a company ...

Determine Valuation of the company

Financial Modeling of business

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Fundraising Valuation Report

  • Share financial information

    Customer shares company’s financial data

  • Value is calculated

    Valuer calculates enterprise valuation

  • Valuation Report is issued

    Merchant Banker issues signed report

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Share financial information

Customer shares company’s financial data

discussion
Arrow pointing to next blockArrow pointing to next block

Value is calculated

Valuer calculates enterprise valuation

customize-draft

Valuation Report is issued

Merchant Banker issues signed report

Contents of Report

  • overview

    Overview

    The name and registration number of the Merchant Banker and details of the company requesting for Fundraising Valuation Report

  • scope-of-work

    Scope of Work

    Outlines the specific shares being valued, along with any limitations or restrictions on the valuation process.

  • methodology

    Methodology

    Details about the approaches and methods used to determine the value of the share.

  • market-analysis

    Market Analysis

    Information about the relevant market conditions, trends, and factors that may impact the value of the share.

  • valuation-results

    Valuation Results

    The final estimated value of the asset, along with any supporting calculations or analyses.

  • valuer-declaration

    Merchant Banker's Declaration

    A statement by the Merchant Banker confirming that the report has been prepared in accordance with relevant laws and standards.

  • signature-and-stamp

    Signature and Stamp

    The report is signed by the Merchant Banker, along with their official stamp or seal.

Benefits of Fundraising Valuation Report

  • credibility

    Credibility

    The report is prepared by a Merchant Banker/Registered Valuer/CA which lends credibility to the valuation process and assurance to stakeholders.

  • regulatory-compliance

    Regulatory Compliance

    Fundraising Valuation Report ensures compliance with the provisions of the Income Tax Act, SEBI regulations and RBI guidelines.

  • assessment

    Objective and Unbiased Assessment

    It provides an impartial and unbiased valuation, free from any conflicts of interest.

  • risk-mitigation

    Risk Mitigation

    Fundraising Valuation Report helps mitigate the risk of disputes or disagreements related to the value of the asset.

  • reporting-and-accounting

    Financial Reporting and Accounting

    Premium per share as mentioned in the Valuation Report is used for financial reporting purposes as per accounting standards compliance.

  • accountability-and-ethics

    Professional Accountability and Ethics

    The preparation of a Fundraising Valuation Report demonstrates adherence to these standards, which enhances trust and confidence in the valuation.

  • methodology

    Documentation of Methodology and Assumptions

    Transparency in method, approach, and assumptions helps stakeholders understand how the value was determined.

Documents Required for Fundraising Valuation Report

  • Business Plan and Financial Projections

    A detailed business plan outlining the company’s strategy, goals, market analysis, competitive edge, and financial forecasts. This should include projections for revenue, expenses, cash flow, and EBITDA for upcoming years.

  • Historical Financial Statements

    Audited financial statements (income statement, balance sheet, cash flow statement) for the past three to five years, providing a track record of financial performance.

  • Capitalization Table

    A cap table that details the equity ownership of the company, including shares held by founders, current investors, and option holders. This document is crucial for calculating pre-money and post-money valuations.

  • Investment and Funding History

    Documentation of all previous funding rounds, including terms of investment, valuation at the time of each investment, and investor details.

  • Market and Industry Analysis

    Comprehensive market research and industry reports that support the company’s growth projections and valuation. These should include insights into market size, growth trends, and competitive landscape.

  • Competitor Valuations and Benchmarks

    Information on valuations and financial metrics of comparable companies, which can be crucial for relative valuation methods.

  • Term Sheets or Letters of Intent

    Any existing term sheets or letters of intent from potential investors, which can influence the valuation negotiations.

  • Legal and Compliance Documents

    Any legal documents that affect the company’s operations or valuation, including intellectual property rights, regulatory approvals, and compliance certificates.

  • Management Team and Employee Information

    Bios and roles of key team members, emphasizing their experience and skills relevant to achieving the company's strategic goals. Details on the organizational structure and employee count can also be relevant.

  • Minutes of Recent Board and Shareholder Meetings

    Records of discussions and decisions regarding strategic directions, fundraising, and other relevant issues.

  • Exit Strategy Considerations

    Information on potential exit strategies for investors, including historical examples of industry acquisitions or IPOs.

  • Risk Analysis

    An assessment of potential risks that could impact the business and its valuation, including market, operational, and financial risks.

Deliverables

  • valuation-results

    Determine Enterprise Valuation

  • description_black_24dp

    Issue of Valuation Report signed and stamped

Frequently asked Questions

What is a Fundraising Valuation Report?

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Unlike a traditional Business Valuation Report, a Fundraising Valuation Report estimates a company’s worth specifically for attracting investors. It’s a forward-looking assessment crucial for startups and young companies seeking funding.

How does a Fundraising Valuation Report differ from a Business Valuation Report?

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A Business Valuation Report focuses on a company’s current market value, while a Fundraising Valuation Report emphasizes the company’s potential for future growth and return on investment, making it more attractive to investors.

What factors influence a company's attractiveness in a Fundraising Valuation Report?

Close

Key factors include the size and growth potential of the target market, the company’s financial forecasts demonstrating future profitability, the management team’s experience and industry expertise, and a clear analysis of the competitive landscape showcasing the company’s unique value proposition.

What's the benefit of a Fundraising Valuation Report?

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The report acts as a compelling story for investors, highlighting the company’s potential for significant growth and a strong return on investment, ultimately increasing the chances of securing funding.

Is a Fundraising Valuation Report mandatory?

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No, it’s not mandatory, but it’s a valuable tool for startups and young companies seeking investment by providing a credible and forward-looking assessment of their potential.

What is fund valuation?

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Fund valuation refers to the process of determining the fair market value of a venture capital fund or a private equity fund. This value reflects the overall worth of the fund’s portfolio companies, considering their current and projected future value.

What is the validity period of a valuation?

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A valuation is like a financial snapshot at a specific date. Its accuracy generally holds for about a year, assuming no major changes in your business or the market.

Why do I need a professional valuation if I have an idea of my business worth?

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A professional valuation provides credibility and defensibility for your estimated worth. It uses recognized methods and considers factors you might miss, strengthening your position in negotiations or financial reporting.

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