Valuation is both an art and a science in VC from "summary" of Mastering the VC Game by Jeffrey Bussgang
Valuation is a complex and multifaceted aspect of venture capital investing. It is not simply a matter of plugging numbers into a formula and arriving at a definitive answer. Rather, it involves a combination of quantitative analysis and qualitative judgment, which is why it is often described as both an art and a science. On the quantitative side, valuation involves the application of financial models and methodologies to determine the current and potential future value of a company. This can include techniques such as discounted cash flow analysis, comparable company analysis, and precedent transactions analysis. These quantitative tools provide a framework for understanding the financial performance and prospects of a business, but they...
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