What are the common methods used for valuing startups in venture capital?
Common methods include the Discounted Cash Flow (DCF), Comparable Company Analysis, and Precedent Transactions.
Can you explain the Discounted Cash Flow method?
Sure! The DCF method estimates a startup's value based on its projected future cash flows, discounted back to present value.
What about Comparable Company Analysis?
This method involves comparing the startup to similar companies in the industry to determine its value based on market metrics.
Are there any specific metrics I should focus on?
Yes, key metrics include revenue, EBITDA, and growth rates, which help in making accurate comparisons.
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