Startup Funding Espresso -- Liquidation Method of Valuation
Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. In raising funding, you\u2019ll need to propose a value for the equity in your startup. This is called valuation.\xa0 One way to determine it is to use the liquidation method. Here\u2019s how it works. The exit value is set to the value of the business at liquidation, which means the value of all assets minus liabilities. Assets include equipment, computers, servers, branding, and data such as customer lists. Liabilities include debts, cost to let go employees, contracts and leases terminated, and taxes to be paid. This values the business primarily for physical assets and branding. It\u2019s possible your computer code or prospect list would be of value as well. When you sell the business for assets only, it\u2019s often about 10% of what you could have sold it for if it were an ongoing business. Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.Let\u2019s go startup something today. ___________________________________ For more episodes from Investor Connect, please visit the site at: \xa0 Check out our other podcasts here: \xa0 For Investors check out: \xa0 For Startups check out: \xa0 For eGuides check out: \xa0 For upcoming Events, check out \xa0 For Feedback please contact info@tencapital.group\xa0\xa0 Music courtesy of .