Skip to main content
All CollectionsProduct GuidePrivate company valuation
How Does the Maturity of a Business Influence the Default Valuation Methods?
How Does the Maturity of a Business Influence the Default Valuation Methods?
Updated over 4 months ago

Understanding how the maturity stage of a business influences the choice of valuation methods is crucial for accurate and relevant assessments. Different stages of maturity present unique characteristics and risks, which necessitate tailored valuation approaches. This guide will walk you through the appropriate valuation methodologies for each stage of business maturity, helping you choose the best method for your valuation object.

Maturity Stages and Appropriate Valuation Methods

The following tables provide a comprehensive overview of which valuation methods are most suitable for different stages of a business’s maturity.

Income Based Methodologies

Maturity of valuation object

DCF simplified

Dynamic WACC

APV

FTE

DDM

Cap. earnings

Concept

x

x

Startup

x

x

Scale-up / Growth

x

x

Mature: Private

x

x

x

x

x

x

Mature: Public

x

x

x

x

x

x

Restructuring

x

x

x

x

x

x

Liquidation

x

x

x

x

x

x

Trading Comps Methodologies

Maturity of valuation object

EV/Sales

EV/EBITDA

EV/EBIT

P/E

Concept

x

Startup

x

Scale-up / Growth

x

Mature: Private

x

x

x

Mature: Public

x

x

x

Restructuring

x

x

x

Liquidation

x

x

x

Transaction Comps Methodologies

Maturity of valuation object

EV/Sales

EV/EBITDA

EV/EBIT

P/E

Concept

x

Startup

x

Scale-up / Growth

x

Mature: Private

x

x

x

x

Mature: Public

Restructuring

x

x

x

Liquidation

x

x

x

Other Methodologies

Maturity of valuation object

VC Method

LBO

Concept

x

Startup

x

Scale-up / Growth

x

Mature: Private

x

Mature: Public

x

Restructuring

x

Liquidation

x

Did this answer your question?