Much is being said these days about IPO valuation gap. The gap refers to a situation where IPO valuation drops below the valuation of the latest private financing round. WeWork is the most recent example with its massive $47B private valuation (we will call it “headline valuation”) being reduced by 70% to $15B as it
Or a radically new approach to goodwill. Introduction Much is being said these days about the utility of accounting for goodwill. Two key concerns seem to dominate the discussion: conceptual vagueness of goodwill, the uncertainty of subsequent accounting, and related accounting costs. While certain aspects of accounting for goodwill warrant deeper review, it seems that most
The goal of the survey is to assist valuation clients in selecting a valuation date. Valuation date issues are more prevalent in common stock valuations (a.k.a. 409A valuation) because it requires strict coordination with equity-based compensation dates.
Fenwick & West just released its survey on key metrics for initial public offerings in the technology and life sciences industries. Among its many interesting findings are: “The 59 life sciences and technology offerings completed in the first half of 2019 compared with the 57 in the second half of 2018, continuing a trend of
A capitalization table, a.k.a. “cap table”, is simply a record of who owns which piece of your company. As your company grows, this seemingly straightforward table often becomes increasingly complex. It can be difficult to keep cap tables current for your investors who require them to be up-to-date so that they can see the current
Frequently, startups find it desirable to make stock options cheaper for their employees to exercise. The exercise price, amount an optionee would pay to take ownership of a share of common stock, is commonly set based on the fair market value of the common stock at the time of the grant. Hence, the need for
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