Establishing the value of a company presents multiple challenges, and even more so when it comes to a start-up. This is because newly created assets with an innovative profile and great growth potential add an extra layer of complexity to the process. How is a start-up valued? A question that entrepreneurs and investors ask themselves.
A start-up is not just a newly created company. By definition, it is a company that is providing a new product or service and, therefore, opening up a new market.
This particularity presents difficulties when determining its value because there is no historical data on the company. It is not possible to analyse the seasonality of its sales, and it is complex to determine its cost structure because there is no access to financial statements.
Of course, analysing competitors who work with a similar product as a benchmark is not possible.
In what cases does a start-up need a valuation?
In their initial phase, start-ups are usually financed by family and friends. However, once the project is launched, other sources of capital are needed to reach its full potential. This is where financing rounds come into play. business angels, seed capital, companies venture capital, It all depends on the stage of development the project is at. To secure funding, start-ups need to have their value determined by an independent company.
The task of the Gesvalt team is to evaluate multiple variables and assist in organising the company before reaching the valuation stage.
What does Gesvalt do for start-ups before their valuation?
- Assists in defining business plans.
- Identify and clarify what the value drivers are.
- It brings rigour and objectivity to the idea presented.
- Position the company within the market in which it will operate.
- Analyse what kind of competition you will be facing.
- Outline how the project will be developed.
- Supports the search for funding.
- Detect and implement controls that prevent the start-up from drowning due to poor management.
What additional value does Gesvalt bring to the operation?
Gesvalt offers a unique added value for start-ups seeking funding:
- It is approved by the Bank of Spain.
- Complies with CNMV requirements.
- It is a company approved by the Ministry of Economy and Finance.
When applying for financing, these attributes lend credibility to a financial institution.
Finally, Gesvalt provides objectivity, organises the startup's ideas and manages expectations, which are necessary requirements in the search for economic viability.
We are specialists in startup valuation. Find out about our services at valuation and consultancy.