<div>I don't know anyone who would value using such a method. After 4 years i assume the company is going to be vaporized?</div>
<div>This may be how you value something with a short asset life (a car, for example) but it's far to primitive a method to value a going concern with.</div>
<div> </div>
<div>-yair</div>
<div> </div>
<div>p.s. no offense meant, contstructive criticism only. Your point about valuing from the point of view of the buyer, however, is very well taken.<br><br> </div>
<div><span class="gmail_quote">On 2/19/06, <b class="gmail_sendername">Ron Arts</b> <<a href="mailto:ron.arts@neonova.nl">ron.arts@neonova.nl</a>> wrote:</span>
<blockquote class="gmail_quote" style="PADDING-LEFT: 1ex; MARGIN: 0px 0px 0px 0.8ex; BORDER-LEFT: #ccc 1px solid">CC Asterisk wrote:<br>> Well basically we have a small service company with about 3200 subs. We<br>> are exploring the possibility of selling it to an ITSP. My main question
<br>> was beyond the formulas - is there some kind of accepted valuation in<br>> the VoIP industry.<br>> Our churn in the last 2 years has been about 0.8% a month. We work in a<br>> specific niche and have been growing nicely there.
<br>><br>> Does that help?<br>> Mark<br>><br><br>I can offer you a more traditional way of looking at it:<br>suppose I buy your company. I do that because I want to make money.<br>When? Well many people say after 3-4 years. Suppose you have a yearly
<br>profit of $200000. If I want to make money after 4 years I would<br>not pay more then $800000 for your company.<br><br>Figures are just examples, and I know there are more things to consider<br>like growth potential, intrinsic value etc, and this may not be applicable
<br>in new and fast growing industries, but try to think like a potential buyer,<br>and try to find the buyer that sees the most value in your company.<br><br>Basically value is in the eye of the buyer.<br><br>Ron<br><br>
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