Convertible notes are starting to resemble CDOs, collateralized debt obligations that led to the 2008 financial crisis, partly because few understood how they worked. From the economic perspective, convertible notes are complex; that includes Simple Agreements for Future Equity (SAFEs). In fact, they are referred to as “complex financial instruments” by auditors and financial regulators.
Most M&A pricing efforts are focused on valuing an acquired business. Essentially no consideration is given to the value of assets an acquirer is giving up in a transaction. We will attempt to clarify some of these issues.
Just over three months ago, financial markets started responding to the news of a new pandemic. Within the following four weeks S&P 500 fluctuated between 3,373 and 2,237, effectively losing a third of its value. One of the most significant financial valuation melt-downs was on its way.
From the letter to our clients this morning: Good morning, Hope you, your family, and your team are healthy and safe in these uncertain times. I am writing this email to clarify the impact of the recent events on your valuation work. Without much doubt, valuations of business interests, assets, liabilities and financial instruments have
Startup companies don’t just disrupt established industries, they add great complexity to ecosystems that support their growth. Among countless supporting functions, valuation services had to up the game. We are not talking about online valuation tools (or SaaS-like offerings), most of which are fantastically dumbed-down versions of Excel models pretending to be AI (we