Seven startups from the original 22 that were accepted into the Agrytech Accelerator have made it to the third and final stage of the program: the incubation stage. During this stage and for the next 6 months, the teams will be working on investor readiness, growing their network of support, finalizing their products and finally, securing investment.
Part of the workshops scheduled for this period is the Business Valuation workshop delivered by Renee Gharios, Investment Officer of IM Capital. Insure and Match Capital (IM Capital) provides Matching Capital, Equity Guarantee, and Support Programs to a broad range of qualified early-stage business and investors in Lebanon.
Business valuation is a process and a set of procedures used to estimate the economic value of an owner’s interest in a business. Valuation is used by financial market participants to determine the price they are willing to pay or receive to affect a sale of a business.
The Entrepreneurs are now building value in their companies, going to market, getting traction, increasing sales, etc. Valuation is a key point to which they need to allocate a lot of importance, because all their efforts will practically be evaluated by this one number.
Even if the founders do not have a finance/investment background, they need to be aware of their valuation, its rationale and the assumptions behind it. It is especially important to be well informed on this topic when investors put the entrepreneur under stress or even begin the terms and valuation negotiation.
“During my presentation to Agrytech, I shared basic financial notions with the teams i.e. equity vs. debt financing, pre-money and post-money valuations, capitalization table, etc. I also shared several valuation methods, how and when they are used – that will help the entrepreneurs brainstorm and have a rough yet reasonable idea of the valuations of their respective companies,” explains Renee.