On February 13th, 2020 you’ll be upgraded to the latest version of Equidam with updated valuation parameters. This may result, on average, in a slight valuation increase.

What’s changing

1 | Average valuations used in the Scorecard Method and maximum valuations used in the Checklist Method

We base our estimates on real transactions by country since November 1st, 2016. Whenever we were not able to find a significant amount of real pre-money valuations in a given country, we broadened our perspective the closest larger geographic entity (namely, continental region and continent). You can refer to the table at this link to see how they will change for your country specifically.

2 | Discount rate components used in the two DCF methods

Most of the parameters determining the discount rate have been updated to reflect the most recent market situation in terms of systemic and industry-specific risk. You will be able to see these parameters in your valuation reports.

3 | Industry EBITDA multiples used in the VC and DCF with multiple

Our multiples are based on public market conditions at the beginning of current year. Data are taken at global level, and aggregated by industry. You can refer to the table at this link to see how they will change for your industry specifically.


General comments on the effect of the changes

On average, valuations will experience a slight increase, following the general trend of last semester.

Valuations in seed phase rounds (angel, pre-seed, and seed) have increased worldwide. By macro areas, the median valuation is comparable among Asia, Europe, Oceania and Africa. North America has the highest median valuation among all areas, while Southern American countries are the one having the lowest median valuation.

Angel, pre-seed and seed rounds kept decreasing in number, confirming the downward trend since 2018, while the median valuation of rounds keep increasing. In the below chart is possible to notice a  growth in median valuation since the last semester of 2016 in North America. The median valuation in the second semester of 2016 was $3 M while in the same period of 2019 the median valuation was $5 M (66% growth). 

In Europe, the trend of less angel, pre-seed and seed rounds is confirmed and, as often occurs, the growth in median valuation was also smaller. In the second semester of 2016 the median valuation was $ 1.8 M and in the same period of 2019 it was $ 2.4 M (33% growth).

The increase in valuation for angel, pre-seed and seed  rounds leads to higher average and maximum valuations, resulting in a higher valuation.

Risk free rates have decreased for almost every country since 2019, as investors have reduced their earlier country risk expectations.

It follows that investing is perceived as less risky, so the valuations of the two DCF methods are modestly higher.

Ebitda multiples are generally higher than pervious year, still depending on the industry, but this element as well will lead to higher valuations.

Please don’t hesitate to let us know in case you have any questions. Thanks for using Equidam!

The Equidam Team