{"id":6051,"date":"2020-04-09T00:00:00","date_gmt":"2020-04-09T00:00:00","guid":{"rendered":"http:\/\/www-staging.carta.com\/sg\/blog\/business-valuation-calculator-for-private-companies\/"},"modified":"2021-03-05T06:55:32","modified_gmt":"2021-03-05T06:55:32","slug":"business-valuation-calculator-for-private-companies","status":"publish","type":"post","link":"https:\/\/www-staging.carta.com\/sg\/blog\/business-valuation-calculator-for-private-companies\/","title":{"rendered":"Introducing a business valuation calculator for private companies"},"content":{"rendered":"\r\n

Millions of private companies<\/a> exist in the US. Some are large corporations with hundreds of shareholders; others are closely held. Some of these companies are early-stage and unprofitable, whereas others are well-established with stable earnings.\u00a0<\/p>\r\n\r\n\r\n\r\n

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No matter the size, industry, structure, or offering, your business has a value. That\u2019s why we created a simple tool for private companies to demystify their valuation.<\/p>\r\n<\/blockquote>\r\n<\/figure>\r\n\r\n\r\n\r\n

The valuation tool below is meant for private companies that are profitable. It uses the capitalized cash flow method<\/a>, which requires discounting the company\u2019s future cash flows at a calculated rate. We’re also working on a methodology for unprofitable companies that we hope to release soon.<\/p>\r\n\r\n\r\n\r\n

This tool is meant to provide a guideline for you to think about the value of your business. Carta\u2019s corporate valuations<\/a> team offers more robust valuation reports<\/a> that you can use to issue options (if you\u2019re a corporation) and profits interests (if you\u2019re an LLC).\u00a0<\/p>\r\n\r\n\r\n\r\n

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What you\u2019ll need<\/h3>\r\n\r\n\r\n\r\n

Cash balance as of today<\/strong>:\u00a0Cash and cash equivalents.<\/p>\r\n\r\n\r\n\r\n

Debt balance as of today<\/strong>:\u00a0Convertible and non-convertible debt.<\/p>\r\n\r\n\r\n\r\n

Expected free cash flow in the next twelve months<\/strong>: Free cash flow is defined as \u201ccash from operations\u201d minus \u201ccapital expenditures.\u201d<\/p>\r\n\r\n\r\n\r\n

The percentage of your company you plan to finance with debt<\/strong>:\u00a0Your company is claimed by debt and equity (Company = Debt + Equity). What percentage of your company do you target to have claimed by debt?

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Kick off your valuation process today\u00a0<\/h2>\r\n

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