Valuations of Early-Stage Companies and Disruptive Technologies
How to Value Life Science, Cybersecurity and ICT Start-ups, and their Technologies
Authors: Rothman, Tiran
Free Preview- Simplifies the mathematical and economic techniques employed in corporate valuations in general, and those for ventures at developmental and early-growth stages
- Draws on a number of interdisciplinary insights when evaluating early-stage ventures, specifically psychological insights into investor/entrepreneur behavior at different intervals throughout the valuation process
- Explores circumstantially specific valuation conundrums and how to treat these analytically
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- About this book
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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 is based on forecasts of free cash flow; in technologically-driven industries, product pipelines can represent a large part of market capitalization. The situation is even more critical for small companies committed to a single idea: all of their value is linked to a single project. Any business transaction or internal proposal to begin or terminate an R&D project in which innovative projects are being valued or exchanged requires a realistic valuation of those projects. Moreover, different projects have very different dynamics. Pharmaceuticals have very large lead times and are dependent on patents as well as out-licensing agreements. In contrast, software develops very quickly, and IP is hard to value. This book will be a guide to building appropriate valuations for companies competing in rapidly shifting industries and offering products under new business models where little precedent exists, taking both financial and behavioral issues into consideration.
- About the authors
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Tiran Rothman has over a decade of experience in financial consultancy and academic and applied research in behavioral finance and economics. As a vice president of Frost & Sullivan, he leads the largest private financial valuation program for high-tech companies and the Tel Aviv Stock Exchange Equity Research Program, involving pharmaceutical, biotechnology, medical device, ICT, renewable energy, autonomous vehicle and cybersecurity companies. He previously served as the Chief Economist of AMPAL (NASDAQ: AMPL). Tiran is also an Assistant Professor at the WIZO Academic Center Haifa in Israel. He holds a PhD in Behavioral Economics from the University of Haifa, an MBA in Finance from IDC Herzliya and was a visiting fellow at New York University’s Stern Business School. He has published widely in the field of behavioral finance and has been the recipient of numerous research grants and scholarships.
- Table of contents (15 chapters)
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Introduction
Pages 3-6
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Understanding Financial Valuations: Foundations and Basic Traditional Techniques
Pages 7-20
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Understanding the Basic Elements of Stockholder Statements and Their Use in Valuations
Pages 23-33
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Valuation Methods: The First Chicago Venture Method and the Use of Real Options
Pages 35-47
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Introduction to Behavioral Finance
Pages 51-63
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Table of contents (15 chapters)
Bibliographic Information
- Bibliographic Information
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- Book Title
- Valuations of Early-Stage Companies and Disruptive Technologies
- Book Subtitle
- How to Value Life Science, Cybersecurity and ICT Start-ups, and their Technologies
- Authors
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- Tiran Rothman
- Copyright
- 2020
- Publisher
- Palgrave Macmillan
- Copyright Holder
- The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG
- eBook ISBN
- 978-3-030-38847-8
- DOI
- 10.1007/978-3-030-38847-8
- Hardcover ISBN
- 978-3-030-38846-1
- Edition Number
- 1
- Number of Pages
- XII, 219
- Number of Illustrations
- 6 b/w illustrations, 5 illustrations in colour
- Topics
