ПРОЦЈЕНА ВРИЈЕДНОСТИ НОВООСНОВАНИХ ПРЕДУЗЕЋА У УСЛОВИМА НЕИЗВЈЕСНОСТИ
THE VALUATION OF START-UP COMPANIES UNDER CONDITIONS OF UNCERTAINTY

Author(s): Tajana Serdar Raković
Subject(s): Business Economy / Management, Accounting - Business Administration
Published by: Savez računovođa i revizora Republike Srpske
Keywords: valuation; valuation methods; traditional valuation methods; alternative valuation methods; start-up companies;
Summary/Abstract: The valuation of the company is a complicated and complex process that requires a whole range of inputs, which is especially expressed in the valuation of the companies in the early stages of development. A large number of very important information, such as revenues, net cash flows, financial statements information, comparable companies data, information related to the movement of stock prices, etc., are not available in the valuation of start-up companies. Start-up companies are characterized by the following characteristics: lack or significant limitation of historical data, illiquid investments, low income, loss-making business, need for private capital, as well as a high percentage of failures in the first years after establishment. The application of traditional valuation methods, due to its limitations, is difficult in evaluating start-up companies, especially in conditions of uncertainty, and requires certain adjustments and changes. Therefore, in the current literature, relevant authors propose alternative valuation methods for companies in the early stages of development. Alternative methods of start-up companies’ valuation focus on future forecasts instead of historical data, using methods of different scenarios and analysing the characteristics and business model of a specific company. The valuation methods for companies in the early stage of development should respect the characteristics of this type of companies, reduce the level of uncertainty, provide more trustworthy valuation, and at the end, relevant and reliable estimated value of companies.

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