Examining the Correlation Between IP and Startup Valuations
Based on recent studies, this article discusses the role that intellectual property (IP) assets play in startup valuations and the IP strategy startups that recently went public implemented.
More ups and downs for patent valuations in the UK and beyond
Business valuers can expect further changes in the UK landscape for IP creation and commercialisation.
Business valuation essentials: don’t overvalue factored assets
Two years out, Carillion remains the largest trading liquidation under UK insolvency law.
Global BVU News and Trends January 2020
Business valuation news from a global perspective.
Royalty Rates and How to Use Them in the Relief from Royalty Method
While multiple sources of royalty rates exist, do you know how to find, select and ultimately use the appropriate data for valuation assessment? Despite its utility, the Relief from Royalty method remains a misunderstood and often misused appraisal technique. Though recent intellectual property court battles have brought prominence to the method and its constituent inputs, with primary focus on Royalty Rates, the underlying confusion generated when putting it to use remains. In this presentation, expert ...
Intangibles often require their own discount rates to derive WACC, Shaw and Higgs report
Since there are very few comparable statistics, analysts often need to assemble their own matrix of required asset return rates for enterprises with intangibles, Steve Shaw (Financial Seminars) told attendees at last month’s ICAEW Valuation Community Annual Conference in London.
Valuing Intangible Assets under the Mandatory Performance Framework: A Fair Value Update
Intangible assets represent an increasingly relevant component of an entity’s value. However, the value of intangible assets is typically not measured on corporate financial statements unless in a business combination under both generally accepted accounting principles (GAAP) in the United States and International Financial Reporting Standards (IFRS) internationally.
Application of the Cost Approach to Valuing Identifiable Intangible Assets
Join Robert Reilly and Nathan Novak for this engaging webinar on the common types of intangible assets, the most common reasons to value intangible assets, and the generally accepted intangible asset valuation approaches.With a focus on the cost approach methods to value intangible assets, particularly contributory intangible assets, this program will describe the specific procedures for quantifying each of the intangible asset cost component and for identifying and measuring each of the intangible asset obsolescence ...
The IP in IPO: IP Valuation Lessons from Recent Public Exits
The year 2019 is shaping up to be a record year for IPOs: from iconic brands, such as Levi Strauss, to technology disruptors, such as Lyft and Pinterest, billions of dollars in valuations have been realized through public exits, providing hefty returns to investors and shareholders. When it comes to understanding what triggers the enormous valuations of some of these companies (commonly known as “unicorns”—a private startup with a valuation in excess of $1 billion ...
Goodwill: A Discussion and a Debate
Two of the most knowledgeable experts in the area of goodwill and personal goodwill, Alan Zipp and Jim Alerding, will cover the key issues and controversies that you want to know about. They will discuss and debate frequently asked questions on the topic, and while sometimes they will agree and sometimes they will disagree, in all cases they will attempt to inform and educate the attendees on the topic.
iiBV intangible assets 212 course gets kudos
Several BVWire—UK readers have commented that they’ve used the new iiBV 212 Valuing Intangible Assets online course to help staff get up to speed on the key business valuation concepts.
BVU News and Trends September 2019
A monthly roundup of key developments of interest to business valuation experts.
Free download: What increases the asset value of a customer?
Valuing customer relations requires quantitative and qualitative judgments.
A few recent research papers of note
These papers can be found at the Social Science Research Network.
In Florida divorce, expert’s ‘with-and-without’ valuation withstands appeal
In a nasty Florida divorce case, an appellate court recently upheld the trial court’s valuation findings concerning the husband’s 50% interest in a successful company that operates in the waste disposal industry.
ICAEW releases programme for Annual Business Valuation Conference
The ICAEW’s event, scheduled for 23 October at their Moorgate Place (London) offices, is the largest BV conference in the UK.
In Allocation Dispute Related to § 363 Sale, Bankruptcy Court Bridges Experts’ Value Gaps
Bankruptcy court performs allocation analysis to divide proceeds from section 363 asset sale between two competing lenders, finding debtor’s intellectual property is most valuable asset; court notes that, at time of sale, debtor was neither healthy going concern nor subject of forced liquidation.
Delaware Chancery Relies on Deal Proposal Valuation in Adjudicating Buyout Dispute
In buyout dispute, court says parties’ letter of intent states buyout conditions; court relies on amount stated in plaintiff’s debt/equity deal proposal to value subject company, finding parties’ trial experts used methods (DCF and asset accumulation) not suited to valuing subject company.
Brand valuation consultancy joins the IVSC
Brand Finance became the first brand valuation consultancy to join the International Valuation Standards Council (IVSC).
Smith v. Promontory Financial Group, LLC
In buyout dispute, court says parties’ letter of intent states buyout conditions; court relies on amount stated in plaintiff’s debt/equity deal proposal to value subject company, finding parties’ trial experts used methods (DCF and asset accumulation) not suited to valuing subject company.
In re Aerogroup International, Inc.
Bankruptcy court performs allocation analysis to divide proceeds from section 363 asset sale between two competing lenders, finding debtor’s intellectual property is most valuable asset; court notes that, at time of sale, debtor was neither healthy going concern nor subject of forced liquidation.
The Legend of Weighted Average Return on Assets and Benchmarking Purchase Price Allocation Data
The author's research shows that only current assets, non-competes, and customer relationships have any predictability to WACC in limited industries. In general, when intangibles have significance, their coefficients are negative, which reduces WACC and implied risk. This finding supports the claim by Lev and Gu (2008) that intangibles are important assets, which reduce, not increase risk. The concept that intangible always should have a premium above WACC is unfounded, and the premise of ARM 34 that intangibles are ancillary assets is outdated. The author suggests and alternative method to use purchase price allocation data to support the selection of premiums above WACC.
Tips for Valuing—and Designing—Buy-in and Buyout Agreements for Medical/Dental Practices
After hundreds of engagements, the author identifies a number of best practices for both the valuation analyst and the consultant with respect to buy-in/buyout arrangements.
Experts clash over definition of ‘net worth’ in New Jersey buyout dispute
Business partners often think that a buyout agreement will forestall future conflicts. A recent New Jersey case proves the opposite.
Work File Checklist for Documenting the Fair Value of Contract Liabilities
A practice aid based on the Mandatory Performance Framework (MPF) for the Certified in Entity and Intangible Valuations (CEIV) credential.