Valuations of early-stage companies and disruptive technologies : how to value life science, cybersecurity and ICT start-ups, and their technologies / Tiran Rothman.

This book will serve as a practical guide for entrepreneurs and investors/advisors in constructing and understanding valuations of startups in rapidly shifting industries, including the areas of drug development, medical devices, cyber security, and renewable energy. For large companies, valuation i...

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Bibliographic Details
Main Author: Rothman, Tiran (Author)
Format: eBook
Language:English
Published: Basingstoke : Palgrave Macmillan, [2020]
Subjects:
Online Access:Click for online access
Table of Contents:
  • Intro
  • Acknowledgments
  • Contents
  • List of Figures
  • List of Tables
  • Part I: A Short Overview of Valuations
  • 1: Introduction
  • 2: Understanding Financial Valuations: Foundations and Basic Traditional Techniques
  • 2.1 Background
  • 2.2 It's All About Trust
  • 2.3 What Is a Valuation?
  • 2.4 The Advantages and Disadvantages of Corporate Valuations
  • 2.5 What Does a Corporate Valuation Reflect?
  • 2.6 Different Valuation Methods
  • 2.7 What Are Capitalization Rates? Why Are They Important?
  • 2.7.1 Explaining the Formula Elements
  • 2.8 Valuations in New Technology Industries
  • 2.9 Conclusion
  • Part II: Overcoming Valuation Hurdles: How to Conduct Valuations Under Unique Circumstances
  • 3: Understanding the Basic Elements of Stockholder Statements and Their Use in Valuations
  • 3.1 Background
  • 3.2 The Balance Sheet
  • 3.2.1 The Balance Sheet Identity
  • 3.2.1.1 Assets
  • 3.2.2 Liabilities
  • 3.2.2.1 Stockholder Equity
  • 3.2.3 Book Value Versus Market Value
  • 3.2.4 Enterprise Value
  • 3.3 The Profit and Loss (PL) Report or Income Statement
  • 3.3.1 Earnings Calculations
  • 3.3.2 The Statement of Cash Flows
  • 3.3.3 Non-operating Assets
  • 3.3.3.1 Investment Operations
  • 3.3.3.2 Financing Operations
  • 3.3.4 Notes to the Financial Statements
  • 3.3.5 Financial Statement Analysis
  • 4: Valuation Methods: The First Chicago Venture Method and the Use of Real Options
  • 4.1 The Use of Multiples with the First Chicago Venture Method
  • 4.2 Finding Similar Companies
  • 4.3 Valuation Through the Use of Real Options: What Is It and When Is It Used?
  • Part III: Behavioral Factors: How Psychology Affects Bias in Valuations
  • 5: Introduction to Behavioral Finance
  • 5.1 Background
  • 5.2 Investors' Behavior in the Financial Markets
  • 5.2.1 The Hot Hand Fallacy
  • 5.2.2 The Efficient Market Hypothesis
  • 5.2.3 The Psychology of Tail Events
  • 5.2.4 The Availability Heuristic: Why Does an Event Happen?
  • 5.2.5 Mental Accounting
  • 5.2.6 Stock Market Underreaction and Overreaction
  • 5.2.7 Investors' Attention and Trade Shares
  • 5.2.8 Anchoring
  • 5.2.9 Hindsight Bias
  • 5.2.10 Endowment Effects
  • 5.3 Do Experts Exhibit Biases?
  • 6: An Overview of Investor Behavior in Financial Markets and Psychological Influences on Valuations
  • 6.1 Background
  • 6.2 Optimism and Expectations in the Financial Aspect
  • 6.3 Attention and Its Effect on Valuations
  • 6.3.1 Psychology Framework: Attention Theory
  • 6.3.2 Selective Attention and Information Processing
  • 6.3.3 Attention Theory Mechanisms
  • 6.3.4 The Role of Attention in Capital Markets
  • 6.3.5 Attention Hypothesis
  • 6.4 The Myopic Aspect of Skewness Investment
  • References
  • 7: How to Overcome Investor Behavior and Psychological Influences in Valuations: How to Evaluate a Dream?
  • 7.1 Background
  • 7.2 Valuation of Companies
  • 7.3 The r in rNPV
  • 7.4 Valuation of Technology