Session 20: Private Company Valuation

Examine the estimation challenges associated with valuing small or large privately-owned businesses.

[rumsey]

I really like these videos. Ive taken Business Valuation twice and had a real difficult time with it. These really help clear things up.

[marcelokneese]

A must watch for players in the Middle Market M&A arena...

[padmanaditya]

For a public buyer, we assume no illiquidity discount as he is diversified. However, when he goes to sell it to another private company in the future, that company would count illiquidity discount. How should one counter this argument when trying to sell to a public buyer.

[medhaasija]

In 7:17, how did we get the cost of debt as 4.5%?

[jaycrom]

Great discussion on assessing various discounts, impact of leverage & risk issues & public offer pricing

[himanshusinghbaghel]

Informative... Thanks for making such insightful series 🙏

[prasitrattanapiseth]

Dear sir, I have some question to ask you about the cost of capital equation
cost of capital=14.5 ( 100/114.33)+4.5( 14.33/114.33) = 13.25
I can't figure it out where is a 100 and 114.33 come from .
Would you please tell me how to calculate this.?
Thank you so much for your kind post. It help me a lot because its very useful .
Regards,
Prasit rattanapiseth

[bronzduck]

Sir I seriously need you're help, developing something futuristic global financial market. Need your views.

[MrTamegomaith]

Great material A swath.  A question though.

Unlevered beta =1.18
correlation with market = 0.5
Total unleavened beta = 2.36
Leverett beta = 2.56
Cost of capital = 13.23% =debt to capital ratio
cost of equity = 14.50%
debt to equity ratio =14.33%

Could some kindly explain how I apply these figures to a business for valuation? What figures from the business would you use?

[aayushkapoor]

we could use pastor stambough model for illiquidity

[bdt_]

Very informative but also very theoretical as well. Would love to see an example done

[iskander]

Berkshire hathaway level as always! dench!

[AbdulJabbar-lfvt]

better to read a book then watching this video... boring