Growth model

20. Update to net operating losses

In the video on Net Operating Losses, the calculations that I describe from minute 17 to minute 22 require correction! In the video, my calculations assume Deferred Tax Asset can only GO DOWN over time, which is incorrect and was an error on my part! Here’s what need to know Deferred tax assets Formula to remember Correcting the …

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Chapter kickoff

Alright, alright, alright! I’m excited you’ve made it here! In this chapter, we get into the good stuff. We’ll dive into all the financial modeling techniques that are specific and highly relevant to growth stage investing. Many candidates are surprised that, although they are highly experienced in buyout/LBO modeling, how many of these techniques are …

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17. Valuation

FAQ: If multiples are higher today than they were in the past, why don’t we adjust UP our exit multiple, instead of DOWN? The average multiple in the sector for the current quarter is 13.3x. This is indeed a premium to the 5-year cycle average of 9.1x. In this example, we look at the 5-year …

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4. Pre-money, post-money valuation

Key takeaways FAQ: What are the definitions? Pre-money equity valuation refers to the equity value of a company immediately BEFORE the transaction. This valuation provides investors with an idea of the current value of the business, which then lets you determine the VALUE OF EACH SHARE. Pre-money valuation = Transaction enterprise value – net debt …

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9. Net operating losses

**Correction** In this section, there is a small error from minute 17 to minute 22 (roughly) involving how Deferred Tax Assets are projected going forward on the balance sheet and cash flow statement. I’ve included a short correction lesson at the end of the Growth Model section. If you are following along with each lesson …

9. Net operating losses Read More »

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