• Asia-Pacific Journal of Business Venturing and Entrepreneurship
• /
• v.12 no.4
• /
• pp.15-24
• /
• 2017

The major goal of this paper falls on developing new rational valuation model, to help companies and investors in the early stage of growth as to preparing and negotiating valuation of investment, by applying new reasonable discount indexes of calculating Discount Cash Flow in valuation of the start-up which has been recognized the critical fatal flaws of DCF with them. There are three specific studies done in this paper. First, this paper found the solid and viable bases of rational discount indexes as to applying DCF in valuing companies in the early growth stage with reviewing the previous studies including Berkus method, Scorecard Method, and Risk factor Summation method classified the most effective tools of valuing pre-revenue generating companies. Second, this paper quoted and analyzed the previous models and studies, so called, 'DCF-Prime' of applying DCF method as to value companies in the early growth stage by taking all risk factors innate to the companies in the early growth stage as the discount rate Beta coefficient. Third, this paper propose more viable and solid valuation models, so called, 'DCF-Plus'of combing all validated valuation factors in Berkus, Scorecard, and Risk Factor Summation methods into applying separate discount bracket after DCF Valuation over the companies in the early growth stage instead of taking them as the factors of discount rate, beta coefficient, like the previous model of DCF-Prime. DCF-Plus mainly developed in this paper will not only provide more rational valuation bases as to investment negotiation between companies and investors in the early growth stage, but also providing more accountable guidelines to companies in the early growth as to prepare investment raising and accelerating their company's value by themselves.

• Journal of the Korean Operations Research and Management Science Society
• /
• v.26 no.3
• /
• pp.21-37
• /
• 2001

Riding on the wave of the information technology revolution, a slow of internet venture businesses (IVB) came into being. Hence, one of the recent developments in Korean capital market has been the proliferation of IVB, which is in accordance with the worldwide trend of ‘new economy’. Although the fair valuation is crucial for the nourishment of IVB, it is difficult to apply traditional valuation methods to these firms without reservation. It is due to the facts that most venture firms have little records of performance, grow unprecedently fast, and have highly uncertain future. The main purpose of this study is to suggest performance evaluation system of IVB and to develop KPE (Key Performance Indicators). Our empirical study is based upon Kaplan & Norton’s Balance Scorecard (BSC) approach. Specifically, our research has been conducted by the following two subsequent procedures: Firstly, seven internet venture firms have been selected and their executives have been interviewed by FGI(Focus Group Interview) method. Based upon these results, performance indicators have been developed. Secondly, by using the above mentioned BSC items (i.e., financial perspective, customer perspective, internal perspective and innovation & learning perspective), questionnaires have been constructed and sent to IVB through e-mail as well as over the Fax. Among the collected 110 samples, reliable 106 samples have been used to build BSC model and to draw our conclusion. In the future study, it would be much better to consider the role of strategy in IVB and the causal relationship among Key Performance Indicators of BSC.