AI-POWERED Valuation PLatform
Valer - Business Valuation
Product Overview
Valer is an application designed to estimate a company's value using historic & forecasted financials, standard methodologies, comparables selected using proprietary algorithms with private data sources. With a step-by-step approach, users should be able to generate a comprehensive report that can be used for various purposes like raising capital, potential acquisition, and more.
Problem
A company’s valuation is essential whether you’re issuing equity to employees, raising capital, or selling the business. For entrepreneurs and growth-stage companies, it is essential to know an estimation of a company's worth.
Determining an appropriate and defensible valuation for a company typically isn’t a simple or quick process. Traditional valuation methodologies rely on experienced banker's expertise. These time-consuming processes often lack critical information or have manual errors in inputs like earnings statements or identifying the most appropriate comparables. Any mistakes can potentially have a significant impact on a company’s valuation.
Goal
The goal is to develop an application that allows startups and small to mid-sized businesses, regardless of their expertise in valuation processes, to evaluate their companies. This app will generate fully customizable reports tailored to specific criteria, utilizing a flexible valuation approach that adapts to each user's unique needs and preferences.
Process
Discovery
Competitive Analysis
This competitive analysis examines the key players in the business valuation software market, focusing on tools similar to Valutico, Pitchbook, BizEquity and Equidam. These tools are designed to simplify the valuation process for businesses, though they target different user segments and offer distinct features.
The table below presents a comprehensive comparison of the strengths and weaknesses of these tools in order to identify opportunities and gaps for a new valuation platform.
Analysis Summary
The Valutico and PitchBook focus on advanced financial users, offering high customization and detailed analytics but are costly and complex.
BizEquity and Equidam cater to smaller businesses and non-expert users, emphasizing ease of use and affordability, but they lack the depth and flexibility of more premium tools.
Opportunities exist in creating a mid-tier tool that balances ease of use with deeper customization and flexible pricing.
Market Research
Opportunities
Market-Gap
User Research
I had the opportunity to interview 5 bankers working on the advisory side. Interview was semi-structured and questions were open ended so I that I could understand their workflow, pain points with the current tools and any other unknowns.
The average work experience of these bankers was over 10 years , had worked extensively on buy-side and sell-side M&A transactions. Their valuation process primarily involves using Discounted Cash Flow (DCF) analysis, comparable company analysis, and precedent transactions. They currently rely on Excel, CapIQ, and specialized M&A software like PitchBook for these tasks.
Challenges
User needs & expectations
User Personas
Persona #1
Persona #2
Product Demo
Roadmap
Version 2.1
The next enhancement will allow users to compare custom multiple outputs with recommended market values.
For the capital raise product use case, the application should be able to recognize the new funding type, factor in the change in company equity ownership that will occur based on new capital raises in the output, and show the change in valuation ranges.
UI refinement in the upcoming version for a more polished look and feel.