| Topic Name: |
Business Plans Advice Needed |
| Message Name: |
Financial Projections |
| Date Posted: |
06/11/2001 |
| In Reply To: |
I would appreciate any recommendations (e.g., articles, texts, busines plans, etc.)regarding the following:
I am working on the business plan for an innovative beverage company with rapid revenue growth. The Company has received $1,ooo,ooo in financing last summer, but now needs additional financing. I believe the Company needs to prepare a detailed budget estimating the amount of money it requires to enable it to get to a sales level where vc's or private equity funds would be interested in investing, but I have no idea what percentage interests should be given to the new investors or how the company should be valued. Part of the complexity arises because on a discounted cash flow basis you can get a wildly different valuation than on a comparable transactions analysis (i.e., valuations based on sales multiples of small beverage companies acquired). In my mind, the discounted cash flow model is not particularly helpful since in the event a large beverage company acquired this small business, the large company's cost structure and marketing/distribution capabilities would be radically better.
Much appreciated. |
| Message: |
I am not an expert in this arena, but I would say you could try contacting an analyst that follows this space and talk to him/her about how the market values these types of companies. I would guess that given today's markets, the venture capital valuation cannot be that much different.
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