Private Company Valuations—A Complete Guide
EQTBloom has redefined the way software are valued. Unlike traditional business appraisals, we understand the nuances of software, considering factors like technology, adaptability, documentation, and feature richness. Our innovative approach integrates three key valuation methods: historical analysis, cost to reproduce, and income assessment, providing a holistic perspective on software worth. Utilizing the COCOMO II model, we meticulously calculate reproduction costs, empowering software developers and companies with invaluable insights for strategic decision-making. Whether you're navigating acquisitions, sales, or growth strategies, EQTBloom is your premier destination for comprehensive software valuation services.
A robust valuation can enhance your startup's attractiveness to potential investors. It demonstrates the value and potential of your SaaS offering, facilitating fundraising efforts to fuel growth and development.
Understanding the value of your software enables informed strategic decision-making. Whether you're considering partnerships, acquisitions, or expansion plans, a clear valuation provides valuable insights into your startup's position in the market and its growth trajectory.
When engaging in partnerships or negotiating deals, having a solid understanding of your software's value gives you leverage. It ensures fair terms and equitable agreements, protecting your startup's interests in various business transactions.
Software valuation serves as a benchmark for assessing your startup's internal performance and progress. It helps track the growth and value creation of your SaaS product over time, guiding resource allocation and investment priorities.
For many startups, the ultimate goal is an exit strategy, whether through acquisition or public offering. A well-defined software valuation is essential for attracting potential acquirers or investors, maximizing the value of your startup during the exit process.
Our comprehensive software valuation process includes expert analysis of key value drivers such as technology, functionality richness, adaptability, and intellectual property (IP) rights. These factors play pivotal roles in determining the software's worth.
We assess various aspects of innovation, ease of modification, replacement cost, and remaining useful life or potential obsolescence. For instance, we scrutinize whether the software's language remains contemporary and user-friendly. Moreover, we evaluate the level of legal protection for its intellectual property.
Our evaluation delves into the software's usability, maintainability, efficiency, and cross-platform applicability. We ascertain whether the software seamlessly integrates with the latest versions of other software, enhancing its utility and value.
Software that can effortlessly scale to accommodate diverse business structures and seamlessly integrate with other applications commands higher valuations. In today's increasingly technology-driven landscape, businesses seek adaptable software solutions to enhance operational efficiency and effectiveness.
Our analysts thoroughly examine the extent and quality of documentation provided, catering to both programmers and users alike. This includes assessing the availability of user support, developer manuals, and help utilities. Comprehensive documentation serves as the primary source of information for software utilization, enhancing its usability and value.
At EQTBloom, we help our clients derive the maximum valuation for their software, meticulously delineating the effort and cost considerations for a given software product. Our adept valuation team employs a weighted average approach of three distinct methods to evaluate software value.
Through our comprehensive valuation process, we equip clients with a lucid and thorough understanding of their software's financial worth, enabling informed decision-making and strategic planning.
The Asset approach discussed earlier utilizes the Constructive Cost Model (COCOMO) to calculate the cost to reproduce method. COCOMO is a procedural cost estimation model widely used in software projects to reliably predict parameters like size, effort, cost, time, and quality. It was introduced by Barry Boehm in 1981 and is grounded in a thorough study of 63 projects, making it one of the most well-documented models available.
| Thousands of new source lines of code | 678.50 |
| Functional Lines of Code (90%) | 610.65 |
| Obsolescence (20%) | -122.13 |
| Total functional lines of code | 488.52 |
| Person Months | ₹ 50000 |
| Cost per person month | ₹ 6,600 |
| Total Cost | ₹ 2,12,25,500 |
EQTBLOOM
Vatsalaya Rasa Private Limited
Address: WZ 1324 Rani Bagh Delhi 110034
Email: contact@eqtbloom.com
Phone: +91 9711003475
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