The correct valuation of any business is both a difficult and a subjective undertaking that depends on the time, place and context of the valuation. Valuation is a much discussed topic with few rights but many wrongs. Since common business valuation models can only partly be applied to Venture Capital investments, Atila Ventures has its own approach to valuations, which is based on experience from its Partners, numerous VC and M&A transactions, was developed from work with leading business schools and links business fundamentals to financial markets.
Atila Ventures combines
  • an Operating Scoring Matrix (OSM) – in which operating aspects such as market, competition, entry barriers, customers, management and sales are evaluated independently – with
  • numerous finance-oriented methods (DCF, PE-/EBITDA-/sales-multiples, transaction and peer comparables, Real Options Model).
The score achieved through Atila’s OSM defines whether an investment should be pursued at all and, if so, with what target IRR. The likely achievable valuation on Exit through Trade Sale or IPO and associated state of the markets are an additional important contributor to the overall valuation.
Atila Ventures’ valuation approach is particularly suitable to early-stage and expansion investments where a high degree of uncertainty is attached to purely finance-oriented forecasts.
To reduce risk, Atila employs its OSM-model in valuing VC opportunities.