Complex Carried Interest Valuation Gets Additional Scrutiny by IRS

  In recent years, our team has seen an increasing number of valuation requests from general partners (“GPs”) of venture capital and private equity funds related to carried interest. For those unfamiliar, the carried interest is also referred to as “the profits interest” because it entitles the GP to a portion of the profits earned … Continued

The Changing Landscape for Portfolio Valuations

  Unlike public equity and fixed income fund managers, venture capital and private equity funds lack an active exchange to price the changing value of their investments. Instead, they perform valuations – oftentimes on a quarterly basis – so they can report updated values to their investors. This year, the disruption caused by the COVID-19 … Continued

COVID-19 and Valuations: What You Need To Know

  Executive Summary Two key things to consider when seeking a professional valuation of your business for 409A purposes Why “material events” should be on every founder’s radar during the COVID-19 pandemic The specific ways COVID-19 could impact a company’s valuation and therefore significantly influence its 409A Introduction The business world is going through unprecedented … Continued

The Factors That Drive a Startup Valuation

An In-Depth Interview with Redwood Valuation Director Tim Montgomery   Redwood Valuation’s Director Tim Montgomery recently sat down with the founder of WatchPitch, Trey Scott, to provide a behind-the-scenes look on what goes into the valuation of a venture-backed company. Tim discusses the numbers that matter – revenue growth, funding, cash runway – and also … Continued

Everything You Wanted to Know About Purchase Price Allocation

The following interview was conducted with Redwood Valuation’s Tim Iversen, Director (ASA). Tim has nearly 20 years of experience in business valuation during which time he has completed over 700 valuations for both public and private companies. What is a purchase price allocation? It is the process of assigning a fair value to all the … Continued

A Fund’s Guide to ASC 820 Portfolio Valuations

  The teams that manage the finance function of an investment fund have a lot on their plate. And that is especially true around the quarter- and year-end stretch. It is enough of a challenge to monitor and communicate with portfolio companies, to prepare for partner meetings, and to properly close-out the books. Adding the … Continued

WeWork Was Never “Valued” at $47 Billion

  The unraveling of the coworking company WeWork’s initial public offering (IPO) has been well-covered in the media and blogosphere. Various outlets dissected WeWork’s initial registration statement (S-1) back in August. Then the drama began: Slowly at first, then seemingly all at once. One element of the story, however, has been poorly covered by the … Continued