How do VCs Value Your Company - JUST ASK
Interest data from VCExperts upon surveying 127 VC or PE firms.
What valuation method(s) does your firm use when evaluating initial investment (frequency distribution):
| Industry | Comparable Transac-tions | Compa-rable Multiples | Dis-counted Cash Flows | Net Assets of Invest-ment Company | Industry Valuation Bench-marks | Adju-sted Present Value | Option Valuation Approach | Other |
| Software | 45 | 36 | 32 | 9 | 1 | 10 | 3 | 0 |
| Other | 33 | 32 | 27 | 14 | 5 | 13 | 9 | 1 |
| Business Products and Services | 23 | 29 | 13 | 21 | 6 | 4 | 5 | 3 |
| Industrial / Energy | 10 | 11 | 3 | 9 | 2 | 1 | 3 | 0 |
| Semiconductors | 9 | 3 | 8 | 2 | 9 | 4 | 0 | 4 |
| Telecommunications | 11 | 7 | 3 | 8 | 3 | 2 | 1 | 1 |
| Biotechnology | 15 | 3 | 8 | 4 | 1 | 2 | 0 | 2 |
| Healthcare Services | 8 | 8 | 6 | 4 | 1 | 0 | 3 | 0 |
| Consumer Products and Services | 5 | 7 | 5 | 4 | 2 | 0 | 3 | 2 |
| Medical Devices and Equipment | 9 | 2 | 1 | 4 | 6 | 0 | 3 | 1 |
| Financial Services | 6 | 5 | 3 | 4 | 3 | 0 | 1 | 2 |
| IT Services | 9 | 9 | 1 | 3 | 1 | 0 | 1 | 0 |
| Electronics / Instrumentation | 5 | 5 | 0 | 5 | 3 | 1 | 2 | 0 |
| Networking and Equipment | 6 | 4 | 2 | 2 | 2 | 0 | 2 | 2 |
| (blank) | 4 | 2 | 2 | 2 | 0 | 2 | 2 | 0 |
| Media and Entertainment | 6 | 2 | 3 | 0 | 0 | 2 | 0 | 0 |
| Retailing / Distribution | 2 | 0 | 2 | 2 | 0 | 0 | 2 | 0 |
If we analyze the result in terms of industry, it is found that "Comparable Transactions" is also the most popular choice among different industries. "Comparable Multiples" comes as the second most popular method.
