This FAQ is divided into three sections:
The EZvaluation and ProValuation Software
What business valuation methods do EZvaluation and ProValuation use?
EZvaluation relies on the excess earnings method of valuation. This is a very good method for estimating the value of a business that is earning money. It takes into account both financial and non-financial characteristics about the company being valued.
How much time will it take me to answer all the questions?
Using EZvaluation it should take no longer than 15 minutes to answer all the questions, as long as you have the company's recent financial statements (or tax returns) available. Using ProValuation the process make take 45 minutes to an hour.
Does the valuation software consider future potential?
Yes it does. Several of the questions it asks are designed to quantify the future potential of the business being valued. The business valuation method it uses relies partly on past financial performance, as well as non-financial characteristics such as growth projections, industry, and trend which are designed to estimate future potential.
How much Does it Cost?
EZvaluation will calculate the value for free. A detailed report is optional and is priced at $24.95. ProValuation is based on a monthly subscription. Subscription prices vary (from $33 to $50 a month). Based on the length of time and the volume of reports users can pay as little as $1.33/report.
Can I use my report to get a loan?
Your business valuations report can be helpful in getting a loan. Many of our clients have used their report to support loan applications, with good result. The report details the logic used in a way lenders will readily understand. While we do not offer financing services, if you need a referral to someone who can help create a complete loan package please contact us.
Can I use my report to raise investment capital?
Yes. Venture capital and angel investors are very concerned with the current value of a company in which they are considering an investment. A third party business valuation with a clear explanation of the rationale supporting that valuation can be very helpful in persuading an investor to make an investment.
How accurate is EZvaluation?
For most businesses, EZvaluation is quite accurate. In our testing which involved running EZvaluation and then doing the same valuation by hand, the estimate of value was within 15% in nearly all instances. However, there are exceptions. It is less accurate for businesses that have heavy investment in R&D (not yet realized), businesses based primarily on real estate owned by the company, and business less than one year old.
The financial component of EZvaluation is based on a company's single year of financial. In most instances, it provides a very good range a company would sell for in an arm's length transaction, provided the questions are answered honestly. Having said that it may not be appropriate for all business valuations purposes. If the most recent year of financial results is not representative of the business's performance then you should use ProValuation.
How accurate is ProValuation?
For most businesses, ProValuation is quite accurate. In our testing which involved running ProValuation and then doing the same valuation by hand, the estimate of value was within 10% in nearly all instances. However, ProValuation allows a user to exercise more judgement which means that the same company could be valued differently by two users of the software.
In what formats will the business valuation report be created?
The ProValuation can create the report in either pdf or Microsoft Word (.docx) format. You can select either format each time that you print the report. The business valuation is only created as a pdf in the by the EZvaluation software.
Can I edit the report?
The ProValuation report in Microsoft Word format is easily edited after it is downloaded. Additionally, for a fee, you can edit the template that we use to create the report and send it to us so that reports you produce can be in your custom format. You can customize everything from page layout, and fonts to wording. You can include your company logo or pictures in the report. To get started please contact us.
When do I need a professional to help with the valuation?
There are a number of areas where we advise that you seek professional assistance instead of using our software. These fall into two categories, those where we can assist you and those where we can not (but we may be able to recommend somebody who can). The areas where we CAN assist are:
- sales to a related party (such as a vendor or distributor)
- mergers where the acquirer is paying in equity
- when you can not accurately determine the approximate fair market value of your assets
- a start-up that is not producing revenue
- a payroll service, web hosting or ISP
- a professional practice (such as a dental office, law firm, or physician's practice)
The areas in which we may be able to recommend someone to assist you:
A business where real estate is a substantial portion of the transaction and you can not determine the value of the property.
Significant intellectual property, such as patents, that are not yet producing revenue.
Pre-paid vouchers
Why buy pre-paid vouchers?
Pre-paid vouchers allow you to buy in bulk and save on the cost of each report. Some professionals, such as business brokers, also want to give voucher codes to clients so that they can estimate the value of their business independently.
How much do pre-paid vouchers cost?
Pre-paid EZvaluation vouchers can be purchased for:
| Quantity | Charge | Cost per Valuation |
| 1 | $24.95 | $24.95 |
| 2 | $40.00 | $20.00 |
| 5 | $75.00 | $15.00 |
| 20 | $240 | $12 |
| 50 | $400 | $8 |
| 100 | $500 | $5 |
Can I resell pre-paid vouchers?
We place no restriction on the resale of vouchers.
Do pre-paid vouchers expire?
No, pre-paid vouchers are good indefinitely.
Private Labeled Services
What are private labeled services?
Some professionals, such as business broker and accountants may wish to integrate our valuation software with their website. We offer private label services to accommodate such businesses.
Can it have the look and feel of my company's website?
Yes, we can integrate a custom header and footer so that the software looks as if it is on your own website.
Can I use my own domain name?
Yes, we can host the software at a URL like valuation.yourcompanyname.com. Please contact us for more information.
Can I customize the report?
Yes, we can allow you to customize the report to contain special wording. For example, you could include a section of the report that describes the services your firm offers or you could include contact information and biographies of your employees.
Can I restrict access?
Yes, we can password protect your private labeled valuation engine.
How can I use it for prospecting?
We can customize a survey screen as part of the report to allow the users to request more information about your services. The results can be e-mailed directly to you.
ProValuation Features:
- Ability to weight years
- Adjustment from cash to accrual basis
- Ability to edit data (play what if, complete process in several sessions)
- And more
