[Case Solving] Valuation: what are the factors you could used to assess a start-up

Hi there, 

each of us can eventually a use different approach to solving the case… this is precisely what consulting looks for, not standardized frameworks (that usually limit the options), but a new way and out of the box ideas, eventually a combination of different frameworks that would fit this particular case… If standardized frameworks would solve complex problems that MBB solve, companies will unlikely to hire them.

I would recommend putting the CEO hut and thinking how would you approach it if you would want to buy such a start-up? What things would you look at to maximize the investment?

Good luck, 

Lucie

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Hey there,

My clarification question to the interviewer would be:

Do we want to put a value on the company or just list qualitatitive factors that we should look at?

If you want to create a valuation, you would for instance need to estimate the earnings potential of the company (including a multiple). In that case, 3C1P would not work but rather a type of market sizing approach including a plausible market share assumption for the company.

If you want to qualitatively evaluate the business, 3C1P could work but likely won't impress the MBB interviewer. Case interviews for top-tier firms are about understanding a problem and deriving a creative approach / solution, not about memorizing frameworks or books.

Try to come up with your own approach and be sure to make it very concrete and tailored to the situation.

Cheers,

Florian

Hello!

In these cases I always tell the same: why don´t you give it a shot, write your response as if this was the interview day and then ask the community? I assure you that you will learn so much more this way, and it will prep you better for interview day. 

Cheers, 

Clara

Hi there,

It's going to depend on the context of the start-up and the answers to my clarifying questions!

The 4 Ps can work. As can Market/Product/Customer/Competition. You can use a financial model leveraging current + projected cashflows. You can do external/internal.

Many options here!