Hey founderš Ever wondered how startups figure out their worth? Let me break down the Discounted Cash Flow (DCF) methodāitās easy! Whatās DCF? It calculates a businessās current value by predicting its future cash flows and adjusting for risk using a "discount rate." This is especially useful for startups with strong growth potential. Example: A startup expects ā¹50 lakh yearly for 3 years. With a 10% discount rate: - Year 1 = ā¹45.45L - Year 2 = ā¹41.32L - Year 3 = ā¹37.56L Total Value (DCF)** = ā¹1.24 crore š
Download the medial app to read full posts, comements and news.