Musings on Markets

FEBRUARY 2, 2023

The first of the is as companies scale up, there will be a point where they will hit a growth wall, and their growth will converge on the growth rate for the economy. Lowering revenue growth to 15% in 2023 and raising it to 33% in 2024 will deliver almost the same value for the company, as what I get with my smoothed-out values.

Start-ups 99

Start-ups Risk-free Rate Market Capitalization Marketability 99

Equidam

APRIL 22, 2025

10] , [23] , [2] Discount Rate: The rate used to discount future cash flows is typically the cost of equity, calculated via the Capital Asset Pricing Model (CAPM): Cost of Equity = Risk-Free Rate + Beta * Market Risk Premium. [23] 29] TV = (Final Year EBITDA * Industry Multiple * Final Year Survival Rate).

Discounted Cash Flow 64

Discounted Cash Flow Terminal Value Marketability EBITDA 64

Equidam

APRIL 22, 2025

” [1] [2] [4] [15] [19] It estimates a future exit value (often based on projected earnings and industry multiples) and works backward, using the high ROI targets VCs require (due to portfolio risk), to determine what the company could be worth today to justify that future return. [15] 2] [17].

Discounted Cash Flow 52

Discounted Cash Flow Marketability Risk Premium Start-ups 52