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Common Challenges in Private Equity, Hedge Fund and Venture Fund Valuations Under GAAP

Please join Josh Cashman (Managing Partner) and Russ Williams (Director) from Intrinsic in this pre-recorded webinar hosted by Richey May, as they share their expertise in common challenges in private equity hedge fund and venture fund valuations under GAAP. http://www.richeymay.com/blog/common-challenges-in-private-equity-hedge-fund-and-venture-fund-valuations-under-gaap/ Their presentation covers best practices for fund valuation policy and methodology, including an example valuation [...]

By | 2017-06-30T18:39:02+00:00 October 10th, 2016|Uncategorized|Comments Off on Common Challenges in Private Equity, Hedge Fund and Venture Fund Valuations Under GAAP

Adjusting Forecasted Probabilities for Financial Modeling

If something has a given chance of happening this year, what is the likelihood that it will happen tomorrow? In a recent valuation engagement we ran across the following scenario: given the probability of an event occurring in the next year, what is the likelihood of the same event occurring on any given day? The [...]

By | 2015-05-13T17:56:38+00:00 May 13th, 2015|Uncategorized|Comments Off on Adjusting Forecasted Probabilities for Financial Modeling

Negative Contributory Asset Charges

The multi-period excess earnings method (MPEEM) is commonly used to value the primary or most important asset responsible for the income-generating ability of a business enterprise. Typically, the intangible assets deemed to be the primary income-generating assets and valued using MPEEM are customer-related intangible assets and key technology. The MPEEM model estimates revenues and cash [...]

By | 2015-04-08T02:10:08+00:00 April 8th, 2015|Uncategorized|Comments Off on Negative Contributory Asset Charges

Understanding the Private Company Alternative Accounting Elections

In late 2013, the Financial Accounting Standards Board (FASB) approved ASU 2014-02, an alternative accounting for the treatment of goodwill reserved for private companies, affirmatively electing private company status. In late 2014, FASB also approved an alternative accounting policy for treatment of certain intangible assets acquired in a business combination. These alternatives were developed by [...]

By | 2014-12-03T22:31:45+00:00 December 2nd, 2014|Uncategorized|Comments Off on Understanding the Private Company Alternative Accounting Elections

Small Business Buyouts – An Examination of Financing Alternatives

Intrinsic Managing Partner Alex Hodgkin recently published research on the current state of the capital markets for small business buyouts. Click the link below to read the full white paper. Small Business Buyouts - An Examination of Financing Alternatives

By | 2014-09-02T21:50:37+00:00 September 2nd, 2014|Uncategorized|Comments Off on Small Business Buyouts – An Examination of Financing Alternatives

Valuation of Trade Secrets

Valuation of Trade Secrets With rapid advances in technology coupled with the increasingly advanced state of reverse engineering, companies are under greater pressure than ever to protect their intellectual property.  Among the intangible assets, intellectual property is arguably the most diverse, ranging from tradenames, copyrights, and patents to know-how and trade secrets. Despite being commonly [...]

By | 2014-07-29T22:07:23+00:00 July 29th, 2014|Featured|Comments Off on Valuation of Trade Secrets

Utilizing the Differential Put Method

An important step in determining the fair market value of a minority interest in the common stock for a privately-held company is to apply a discount for the lack of marketability (“DLOM”) of the private stock relative to a publicly traded common stock. Once an equity value is determined for a privately-held company using market [...]

By | 2014-07-17T16:38:37+00:00 July 17th, 2014|Featured|Comments Off on Utilizing the Differential Put Method

Determining a Reasonable Volatility Assumption for the OPM

It can be difficult to value privately held equity securities, especially when the company is an early stage firm with no revenue. Traditional methods like the market approach, income approach, and cost approach may not be relevant or provide a reasonable value. However, when an early stage company has raised some form of financing, whether [...]

By | 2014-07-29T19:23:32+00:00 July 15th, 2014|Featured|Comments Off on Determining a Reasonable Volatility Assumption for the OPM

Evaluating Business Projections

If we could predict the future, it’s fair to say that many of us would not have our current day jobs (if we worked at all).  It is fun to daydream.  However, evaluating what might happen in the future is a big part of what we do as business appraisers, as businesses are valued primarily [...]

By | 2014-05-27T14:04:29+00:00 May 27th, 2014|Uncategorized|Comments Off on Evaluating Business Projections

Hybrid Instruments with Embedded Conversion Features

“Progress is man’s ability to complicate simplicity.” Thor Heyerdahl Convertible bonds and preferred stock are popular instruments that cash-starved businesses use to raise capital when other more traditional financing methods are not available. These instruments provide much-needed liquidity to high-risk entities while often enticing investors with embedded conversion features (“ECF”) that offer the prospect for [...]

By | 2014-05-27T21:00:57+00:00 May 1st, 2014|Uncategorized|Comments Off on Hybrid Instruments with Embedded Conversion Features