How Do You Value a Business Start-Up?

Berkus Valuation Method updated after 20 years

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Nov 07, 2016, 10:00 ET

ARCADIA, Calif., Nov. 7, 2016 /PRNewswire/ -- The solution to the problem of how to value an early stage start-up company got a boost today as Dave Berkus, the author of the popular "Berkus Method," published an update to his work after twenty years of use by investors and entrepreneurs worldwide.

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Dave Berkus speaks worldwide about his fifty-plus years as an entrepreneur and investor, and lessons learned, titling his talk "Smiling at success; laughing at failure."

First published in 1996 then widely distributed in the book, "Winning Angels" by Harvard's Amis and Stevenson in 2001, The Berkus Method has become a tool used worldwide by investors and entrepreneurs to provide a simplified answer to the vexing problem of valuing a very early stage company, often one that is pre-revenue.

Using the elements of risk associated with achievement of success, internationally-known early stage investor, Dave Berkus assigned maximum values to each element of risk to measure an entrepreneurial team's progress and likelihood of ultimate success. The sum of the values of risk-reduction elements successfully addressed becomes the value of the start-up.

Used by angel groups, investors and entrepreneurs worldwide, the Berkus Method has become the basis for negotiation of valuation for countless early stage companies over the past two decades.

"After watching others try to fit this method into various types of businesses and in varying geographic areas where values differed dramatically from the norm, I recently revisited the very basic premise of the method, and revised it to accommodate virtually any kind of business and any geographic areas," stated creator Berkus.

The full description of the Berkus Method may be found at www.berkonomics.com/?p=2752, or by searching for "The Berkus Method" in any search engine.

About Dave Berkus: Internationally recognized super angel investor and author, Dave Berkus has invested in over 140 early stage companies since 1993, and boasts a 97% average annual rate of return (IRR). Author of fourteen books on the subject and international speaker to civic, entrepreneur and angel groups, Berkus retells stories and lessons learned from over fifty years of entrepreneurial experience, including his stint as founder and CEO of a multiple-year Inc.500 company that dominated the hotel automation industry, and his service on over forty early stage boards of directors. Video clips and information may be found at www.berkus.com, YouTube, TEDx, or Wikipedia. His weekly blog, BERKONOMICS, is circulated to over 120,000 and may be found at www.berkonomics.com.

Press contact: Dave Berkus, [email protected] or 626-355-5375

Related Links

complete description of Berkus Method

More about Dave Berkus

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SOURCE Dave Berkus