Different valuation methods can return dramatically different results. At B. Riley, we often combine these methodologies and employ more sophisticated models to ensure the accuracy of our appraisals. As a result, our reports have consistently proven audit-defensible when scrutinized.

The Market Approach

Also known as the options pricing model (OPM) backsolve approach, the market approach is commonly used to value early-stage businesses and those failing to turn a profit. It relies on the most recent round of financing and financial data from similar public companies to calculate the FMV of common shares.

The Asset Approach

Appraisers turn to the asset approach for early-stage companies that lack financing and revenue. Without a positive cash flow, this approach equates the value of a company with the new replacement cost of its assets.

The Income Approach

Revenue-generating companies are often valued via the income approach. The method appraises the value of a company as the difference between its assets and liabilities.

B. Riley's experienced accounting team will provide your company with an exhaustive 409A valuation report that will stand up to the scrutiny of an auditor. Reach out to us today to get started.