3 Ways to Determine the Value of a Business from Jameson Van Houten
1. Three Types of Business
Value Assessments
From Jameson Van Houten of Stonegate Financial
Group
2. Asset-Based Assessment
Value of all tangible and intangible assets
Usually used for bankrupt companies or those looking
to sell/liquidate
Does not take future earnings potential into account in
the assessment
3. Market-Based Assesment
Looks at others in the same industry that have recently
been sold.
Takes these prices into account when valuing the
current business in question.
4. Earnings-Based Assessment
Earnings have a multiple applied to them
The multiple varies according to several factors
Industry, outlook for the business in the future, etc.
Normalized earnings adjusted for several things.
Including owner’s compensation and related expenses
5. It’s not easy…
Determining the value of a business is a complicated
process that takes many factors into account.
There’s no one formula that applies across the board.
Seek out the help of a professional like Jameson Van
Houten at http://stonegatefg.com