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Value Alpha

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Alpha for private markets.

Live multiples, defensible valuations, and the numbers before everyone else: written for searchers, advisors, and owners.

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01 · The problem with rules of thumb

Multiples that come from transactions, not rules of thumb.

Sector rules of thumb survive because they are memorable and because, for a long time, nothing better was available to anyone outside an investment bank. They fail in two specific ways, and both of them cost the seller.

First, an industry average is an average of very different companies. A published “typical” multiple for a sector routinely includes businesses that are shrinking, loss-making, or owner-dependent to the point of being untransferable. Applied to a good business, it prices it as a mediocre one.

Second, a rule of thumb is a single multiple applied to a single number, so every assumption disappears into it. There is nothing to interrogate, which means there is nothing to defend when a buyer’s analyst pushes back.

02 · What replaces it

Evidence, filtered to the business in front of you.

  1. 01

    The sector is decided first, not last

    Classification is suggested from the financials and confirmed by you before anything runs. It is not a label applied to a finished number: it decides which methods carry weight, which comparables are admissible, and how the discount rate is built.

  2. 02

    Comparables have to earn their place

    Size, geography, growth profile, and margin structure all filter the set. An $8M apparel retailer is not priced against a $4B listed chain because they share a sector code.

  3. 03

    Several methods, deliberately

    Discounted cash flow, comparable companies, precedent transactions, an asset floor, and a sector model each answer the question differently. Where they disagree is information; where they converge is a range you can defend.

  4. 04

    The blend is visible

    Each method's weight is shown, not buried. You can see what the number would be if you disagreed with one of them, and change it.

03 · What it produces

Disagreement between methods, made visible.

A single multiple hides the fact that reasonable methods reach different answers. The football field shows it, which is what makes the concluded range arguable on specifics rather than on faith.

Football field · enterprise value

Illustrative

Each bar is one method's range. The band behind them is where all three overlap. Discounted cash flow ranges $3.87M to $4.73M, comparable companies $3.95M to $5.35M, precedent transactions $4.44M to $5.96M. The concluded range is $3.73M to $5.66M with a base of $4.60M.

04 · What we publish

We write from the same evidence we price from.

Multiples by industry, what a lender expects to see, how deal structure changes what a seller actually receives: these are not marketing topics we picked. They come out of the same work as the product. If the research is wrong, the product is wrong, which is a useful discipline.

05 · Published research

Work that has to survive review first.

The programme

Private company valuation is under-researched relative to how much money changes hands on it. We publish formal research with academic partners: refereed, attributable, and free to read.

Research

Working paper 01

Forthcoming · October 2026

Title announced on publication

Forthcoming, in partnership with Columbia Business School

Subject · Private company valuation

Columbia Business School

Value Alpha Research

Working paper

Coming soon

06 · Latest

What we are seeing in private markets.

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