Remove Equity Remove Events Remove Terminal Value
article thumbnail

Demystifying Valuation Clauses in LPAs for Emerging Managers

Equidam

In essence, the valuation clause sets the ground rules for measuring your portfolio’s performance between the big exit events. LPs evaluate a fund’s success not only at the final cash return, but also through interim reports that show the fair value of the startups in your portfolio. Why do valuations matter so much?

article thumbnail

Terminal Growth Rate – A Simple Explanation with Formula

Valutico

It’s used in financial modeling and valuation to estimate the company’s long-term value. In particular, the Terminal Growth Rate is used in a DCF analysis to help calculate the Terminal Value. Different industries have varying Terminal Growth Rates based on growth potential and market maturity.

article thumbnail

Startup Valuation: The Ultimate Guide for Founders

Equidam

1] Unlike valuing established public companies with long track records and stable earnings, startup valuation operates in a realm of high uncertainty. [2] 14] The Purpose Across Key Events Valuation serves critical functions at various points in a startup’s lifecycle: Fundraising: This is the most common context for founders.