Definition

Comparing your business numbers with industry standards or competitors. Seeing where you stand can guide simple improvements.

What to consider

  • Consider multiple valuation approaches.
  • Be realistic about future growth.
  • Use valuation results to guide strategic planning.

Real world scenarios

  • A startup obtains a professional valuation before seeking venture capital.
  • An entrepreneur has her business appraised to determine its market worth before a sale.
  • A small firm uses valuation methods to understand its growth potential and investment needs.

Related terms

Entrepreneurial Finances