Answer to Question #150673 in Finance for KJ

Question

The success of your APP brought the attention of a venture capital firm, they are interested in investing your company. Though the APP proves to be a success, your company has not begun to make profits. You have a solid cashflow, but the business is still losing money. You want a fair valuation for your business. How would you evaluate your business using what you learned in Economic?

Answer 1

To evaluate the business i would use the income approach. This would be done by calculaying the Net Present Value (NPV) of the future cash flow for my business.