Startup business valuation: a state‐of‐the‐art review

Valoración de empresas startup: una revisión del estado del arte

T. Botello Velasco and J. González-Bueno
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T. Botello Velasco: UNAB - Universidad Autónoma de Bucaramanga
J. González-Bueno: UPB - Universidad Pontificia Bolivariana

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Abstract: In recent years, business valuation models have evolved from a set of complex methods to an essential tool for valuing financial assets and real assets. In the case of real assets, the precision of the analysis is based on the existence of perfect, efficient, and complete markets, since through them, it is possible to replicate the risk involved and estimate the behavior of the variables to be studied. However, these conditions are weaknesses in certain real assets, such as startups. These companies, in their early stages of life, have a low level of income, negative cash flow and limited information about future economic and financial performance. This study aims to contribute to the literature, mainly in the financial area related to the valuation of startup companies. It is evident that there are few authors who propose a particular methodology for the valuation of this type of company, since in a significant number of cases, the traditional methods are not applicable due to the insufficient or little financial and market information of companies of this type.

Keywords: Startup; Valuation methods; Valuation methods limitation; Startups; Métodos de valoración; Limitaciones métodos de valoración (search for similar items in EconPapers)
Date: 2020
Note: View the original document on HAL open archive server: https://hal.science/hal-03149333
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Published in Finance, Markets and Valuation, 2020, 6 (2), pp.55-69. ⟨10.46503/KIVX7475⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03149333

DOI: 10.46503/KIVX7475

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