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School of Business | Department of Accounting | Accounting | 2014
Thesis number: 13773
Stakeholder perspective on valuation of a start-up company: Empirical case study examining approaches of different stakeholders to a start-up company valuation
Author: Raininko, Miikka
Title: Stakeholder perspective on valuation of a start-up company: Empirical case study examining approaches of different stakeholders to a start-up company valuation
Year: 2014  Language: eng
Department: Department of Accounting
Academic subject: Accounting
Index terms: laskentatoimi; accounting; sijoitukset; investments; päätöksenteko; decision making; riskirahoitus; venture capital; yritykset; companies; kasvu; growth
Pages: 73
Key terms: valuation, investment decision-making, start-up company, entrepreneur, angel investor, venture capital, public institution funding
Abstract:
This study examines how different stakeholders e.g. entrepreneurs, angel investors, venture capital firm and public institution funder perform valuation and constitute their understanding of the value of a start-up company. Further, this study also examines the factors and considerations of each stakeholder within the research perimeter regarding investment or funding decision-making.

The study is qualitative case study by nature. The research setting of this study comprises of case start-up company and its stakeholders team of entrepreneurs, two angel investors, early-stage venture capital firm and public institution funder Tekes. In this research setting, all of the stakeholders view the same start-up company, and the considerations of the valuation and decision- making factors are regarding the case start-up company. The fieldwork was conducted via semi-structured interviews with each of the stakeholders.

The results show that the considerations regarding applicability of quantitative valuation methods vary between the stakeholders within the transaction perimeter. Additionally, the results show that qualitative factors and considerations are significantly important in the valuation and decision-making. Further, the results suggest that actually the value of a start-up company is in line with the collective faith of the stakeholders concerning the other stakeholders of the start-up company. In addition, it seems that public institution funding has its place in start-up company funding by providing funding and also contributing as a stakeholder to the collective faith in the company.
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