1) Supply and demand relationship

Never let your partner think that he is the only buyer of your company, because it will greatly reduce your company's valuation. Not only that, when you begin to prepare for cooperation, let the partners truly feel that your company is brand-new and unique, so as to maximize the value of the company.

2) What industry do you work in

Another key indicator of company valuation is your industry. Generally speaking, each industry has its own unique valuation method.

For example, the valuation of a new generation of biotechnology companies is often much higher than that of traditional companies in the catering industry or small commodity production industry. For example, the valuation of a new company in the catering industry will generally be three to four times that of EBITDA(EBITDA, which refers to the company's total income before deducting interest, taxes, depreciation and installment repayment), but for a website with a rapid growth in page views, its valuation may be five to ten times that of the company's income.

Therefore, before you meet your partner with the expectation of valuation, you need to know something about your industry, especially the mergers and acquisitions in the industry in recent years. If you can't understand the relevant valuation data of other enterprises in the industry, you can hire a financial consulting company first and let them help you analyze it.

3) The development stage of the company

Different stages of development, such as initial stage, development stage and expansion stage, can have different values.

Let's talk about the company's valuation skills in detail.

1. The recent overall financial situation of your industry, including multiples of the company's income, cash flow or net income.

2. Recent mergers and acquisitions in your industry, including multiples of transaction income, cash flow or net income.

3. Discounted cash flow analysis based on your company's forecast cash flow.

There are many indicators of company valuation, even within the same industry or between different industries, there will be considerable differences. Generally speaking, the valuation multiple of EBITDA will fluctuate according to "the actual situation of your company", but the valuation multiple will generally be between three and ten times.