United StatesFreelance Valuation Specialist Since March 13, 2017
Surya has 15+ years of finance, strategy, and deal experience. Most recently, he helped spearhead corporate development and ventures for the consumer health and wellness unit at Advocate Aurora Health. He's also led corporate development, M&A transactions, and strategic planning at the Fortune 100 firms Ingram Micro and MGA Entertainment and performed $25+ billion of valuation advisory work at PwC. Freelancing allows Surya to provide critical analysis and guidance to corporate executives.
United StatesFreelance Valuation Specialist Since January 9, 2018
Ludwig has closed over $30 billion of transactions in the US and Europe at Deutsche Bank's investment banking division. He has worked closely with investment professionals at top firms like Blackstone and Starwood Capital on deals ranging from asset and business disposals to multi-billion dollar acquisitions. He joined Toptal to connect with other entrepreneurs and go-getters and share his knowledge around investing, financing, strategy, and M&A.
United StatesFreelance Valuation Specialist Since November 21, 2017
A data scientist and Harvard MBA with distinction, Erik co-founded a global venture capital fund and has invested in 50 startups that have raised over $500 million, realizing six exits. He previously led analyses for cases including restructurings of $3 billion in global operations and M&A deals worth over $10 billion. Erik's work has been noted in Forbes, CNBC, and HBR. He speaks four languages and serves as Toptal's Chief Economist, leading analyses on the talent economy and future of work.
United StatesFreelance Valuation Specialist Since September 5, 2017
Travis was part of the founding team at Moelis & Co., a $2.5 billion global investment bank, and has 18 years of experience advising clients on $40+ billion of M&A, capital raising, and restructuring transactions. In 2015, he founded a socially responsible advisory firm, Keene Advisors, named "Best for the World" 2017-2019. Travis joined Toptal to expand his network and share his expertise advising companies from startups to Fortune 500 firms.
United StatesFreelance Valuation Specialist Since September 16, 2019
Greg has executed over $20 billion of transactions from seed-stage venture investments to large corporate buyouts. His experience spans the capital structure and includes time at Lazard Frères and some of the top private investment firms on Wall Street. He has worked as as a fractional CFO, M&A and financing advisor, and board member. Greg enjoys freelancing as it allows him to work with a wider variety of clients and company maturities.
CanadaFreelance Valuation Specialist Since November 25, 2019
As a VC associate, Khaled has participated in over 10 startup investments including Kngine (acquired by Samsung). He enjoys freelancing to help wide variety of clients reach their maximum potential using his financial modeling and valuation skills. A former FP&A analyst with Vodafone, Khaled accumulated experience in investment banking, private equity ($1 billion AUM) and venture capital ($50 million fund) over the past 10 years.
United StatesFreelance Valuation Specialist Since September 29, 2016
Jeffrey is a Harvard University graduate who focuses on investment banking for startups and funds, parallel to being a freelance CFO. As an investment banker, he has acted as an interim CFO for 300+ companies and funds. A few highlights of Jeffrey's career outside consulting include being a partner at a VC fund, banking with Morgan Stanley and HSBC, and co-founding a real estate brokerage.
Valuation experts can tell you how much a business is worth and explain why. This guide to hiring a Business Valuation Specialist features interview questions and answers, as well as best practices that will help you identify the best candidates for your company.
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His first bit of work produced a tool for us to model and forecast our financials and is far and away worth every penny we paid and more.
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Pete Pellizzari, CEO
Erik has been an extremely valuable member of our team who has tremendous breath of experience with start ups in our lifecycle phase. What makes his contribution unique and highly effective is not only his excellent financial modeling skills and knowledge, but also the emotional intelligence with which he manages each relationship at Vault, understands our team dynamics, and helps us tackle start up challenges effectively. It is rare to find a part-time consultant who makes you feel like he/she is genuinely invested in the success of your company.
Romy Parzick, COO
Student Loan Benefits, Inc. dba Vault
Toptal has been an incredible key partner for Sidekick. As an early-stage start-up, we’ve leveraged both design and financial talent. The experience has been incredible, with those professionals bringing creativity, expertise, and advice to ensure Sidekick succeeds. My Toptal financial expert helped steer Sidekick’s business model, which resulted in an initial ROI of 650x! My experience with Toptal has given me great confidence in the future.
Doug MacKay, Founder / CEO
Chris was great to work with and was always available on my schedule. His communication skills and personality were a 10/10. His outputs on the project were top notch and allowed us to develop more efficient forecasting and initiative prioritization frameworks. I would definitely use Chris again.
Chris Pozek, CEO
What really sets Toptal apart is the caliber of finance talent available in their network. I had a very specific and pressing need, and Toptal quickly matched me with the perfect person for the job. The expert produced a thoughtful and robust financial analysis that has ultimately allowed us to forecast and prioritize initiatives much more efficiently.
Chris Pozek, CEO
Scott had a lot of finance experience which he used to ask the right questions and help us do things more quickly than we would have done without him. The commission model is crucial to us being able to scale, he integrated seamlessly with our finance team and efficiently got us the outputs we needed.
Naushad Parpia, Founder and CEO
I was very impressed with the quality of finance talent in Toptal’s network. Our expert's experience was immediately evident through his insightful questions and the speed at which we could move. Toptal stayed on top of the process from making the match through to the successful completion of the project. I've already recommended Toptal Finance to my network.
Naushad Parpia, Founder and CEO
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Valuation is the process of calculating a value at which willing and unrelated parties (free from undue duress) would likely buy and sell a business under normal operating conditions.
Why do I need to hire a valuation specialist?
Business valuation determines how much a company (or part of a company) is worth. This is important information to have when you’re buying or selling a business, contemplating a partnership or dissolution, planning for estate purposes, gathering information for tax reporting, or seeking an accurate, unbiased assessment of a fair price for your company. Typically, you’ll need an impartial outside expert to determine this.
What do I need to look for when I choose to hire a valuation specialist online?
Whether you’re hiring a valuation professional online or in person, what’s most important is their history of work in valuation and their experience in the industry under consideration. But you’ll also want to note how they present their experience online, since clear, persuasive written and graphic communication skills are critical in this job.
How do I choose between two quality valuation specialists?
If you’ve narrowed the field down to two candidates with otherwise comparable credentials, you may want to consider which one has greater experience in the specific kind of valuation that applies, such as M&A valuation or private business valuation. Another differentiating factor to look at is the candidates’ expertise in the industry of the company you want to have valued.
Is company valuation a necessary part of the M&A process?
Mergers and acquisitions require company valuations to help the parties agree on a sales price for the business being acquired. Having reliable independent valuations can also aid the business leaders as they make decisions pertaining to the M&A, both before and after the process is complete.
What is the difference between an appraisal and a valuation (or evaluation)?
Each approach is used to arrive at the value of the business. But while there isn’t any formal or legal definition of—or differentiation between—the terms, they’re used differently. Typically, an appraisal tends to be less rigorous than a valuation.
How quickly can you hire with Toptal?
Typically, you can hire a business valuation specialist with Toptal in about 48 hours. Our talent matchers are experts in the same fields they’re matching in—they’re not recruiters or HR reps. They’ll work with you to understand your goals, technical needs, and team dynamics, and match you with ideal candidates from our vetted global talent network.
Once you select your business valuation specialist, you’ll have a no-risk trial period to ensure they’re the perfect fit. Our matching process has a 98% trial-to-hire rate, so you can rest assured that you’re getting the best fit every time.
Eric is a financial services professional with 14+ years of experience as a sell-side, buy-side, and startup professional, advising on debt and equity deals from $10 million to more than $1 billion. While at Apollo Global Management, he deployed more than $2 billion into funds across various structures and sectors.
As M&A Ramps Up Again, Companies Need Good Business Valuation Specialists
Since the slowdown of the early pandemic, demand has been growing for talented business valuation professionals. More than 60% of 800 business owners interviewed for the 2022 MassMutual Business Owner Perspectives Study said that knowing the value of their business was important. “Measuring business health” was the primary reason, but there are many situations in which a company needs a definitive and defensible figure—for example, when the business is up for sale. In 2022, M&A was almost back to pre-pandemic levels, according to The 2022 M&A Report from Boston Consulting Group. Robust demand for business valuation specialists will likely continue throughout 2023 and beyond.
Valuing a business accurately isn’t a job for novices. Unlike real estate deals, business valuations and transactions aren’t published in a public database or otherwise readily accessible. It takes experience to know which of the widely varying techniques and methodologies to use—why the special valuation approaches appropriate for a fintech startup may not be right for more established businesses, for example.
Not only is business valuation a specialized skill, but for most use cases, regulations and stakeholders require that the analysis be conducted—and the report published—by a neutral third party in order to avoid conflicts of interest. This means you must hire a valuation expert from outside your company—whether it’s through a specialized investment bank, a public accounting agency, or a valuation agency—or hire an independent contractor.
This hiring guide offers insights into how to hire the best business valuation consultant for your particular needs.
What distinguishes quality Business Valuation Specialists from others?
When you’re looking for a quality business valuation professional, experience should be your primary criterion. Ideally, your candidate will have a minimum of 10 years of experience in conducting business valuations generally, as well as specialized sector experience relevant to your use case. For instance, if the valuation is being used for tax purposes, it will be subject to extensive scrutiny and liability, so you should hire someone who knows how to handle those tax-specific requirements. If you’d like an indicative valuation, to understand your business’s present worth, someone with fewer than 10 years of experience may be acceptable. It’s not advisable to hire a business valuation specialist with less than five years of experience.
A business valuation analyst uses a variety of data sources and business valuation methods to arrive at a value or range of values that a business would likely command in a transaction between willing parties operating in a normal business environment—in essence, its fair market value. While there are a variety of approaches and methodologies to determine an accurate business valuation, some of the most frequently used include discounted cash flow (DCF) analysis, which assesses value based on the company’s future cash flow as projected in different ways; comparable company trading/valuation multiples (comparable company or comps) analysis, which compares the company to others of similar size in the same industry; and precedent transaction valuation (precedent transactions) analysis, which considers prices paid for similar companies to arrive at a valuation. Depending on the methodology, the results can vary. Knowing which approach is most appropriate is a matter of skill and experience.
While you may see a variety of valuation certifications when researching candidates—such as ABV, CBA, CSC, and CVA, among others—a business valuation analyst doesn’t need a specific valuation certification in order to be good at their job. That said, CFA (chartered financial analyst) is a significant qualification. Globally recognized, the CFA is a general credential for investment professionals that evaluates valuation and financial analysis abilities, among other skills. Certification requires a rigorous three-part exam, as well as years of experience in the field.
How can you identify the ideal Business Valuation Specialist for your project?
Your business valuation professional should possess a mix of hard and soft skills to best determine a company’s intrinsic value. These include:
Skills in analyzing, quantifying, and qualifying business-specific risks; a business valuation specialist must understand how to work with risk, as it affects the potential value of the business.
Critical thinking and facility with writing.
Ability to communicate effectively with company management.
In addition to these valuation skills, the following may be relevant:
General knowledge of accounting and tax principles – Most candidates are likely to have relevant financial experience and credentials. If they don’t, it’s a good idea to check their knowledge of basic accounting and tax principles.
Experience with analyzing and adjusting profit margins – Profit margins are a major driver in valuations, so knowledge of how to calculate and interpret them can be useful.
Finally, if your use case pertains to any of the following areas, be sure the business valuation analyst has significant experience (at least five years) with that specialty, as all three are subject to regulations and/or a high level of scrutiny:
Compliance and other legal matters
How to Write a Business Valuation Specialist Job Description for Your Project
First, clearly describe your use case and business sector, including the stage in a negotiation when the valuation will be used. This will help candidates with relevant experience self-select, based on their experience, as well as give them a clearer sense of the nature of the project.
Next, list the data sources and financial documents you think the valuation specialist may need. You need not have these materials on hand, but think about the steps to acquire them and at what point in the data collection process you’ll want the business valuation expert to step in. Including information about the scope, intensity, and length of the work you need performed will help both you and potential candidates understand what realistic project deadlines and budgets might look like.
Finally, be clear about your expectations in terms of qualifications and experience, bearing in mind the aforementioned guidance about special cases that require advanced expertise. Be specific about what you need.
What are the most important questions to ask when interviewing Business Valuation Specialists?
By the interview stage, you’ll have had the opportunity to look at the candidates’ education and prior positions, and you can then delve into their experience and how it applies to your particular use case.
How should this use case be approached?
It’s important to understand how the interviewee would calculate your valuation, especially if you’re in a niche market. If your company is a fintech or a startup, for example, inquire about their experience with fintech valuations or startup valuations. Or if you’re looking to buy a software company, be sure your analyst understands how to value intangible assets. While you may not be familiar with all valuation techniques, the candidate should be able to explain what approach they think is best for your case and why.
Will this valuation require additional information or data beyond what’s provided?
The answer to this question will help you assess how well the candidate understands your use case, as well as give you a sense of whether the time and money you have budgeted for the project are likely to be on target.
What steps do you follow in your workflow?
Regardless of use case or methodology, a business valuation specialist will generally follow a workflow such as this:
Step 1: Define objectives, stakeholders, resources, and methods.
Understand why you need a business valuation, what data is available, and what specific challenges might arise.
Choose methods and data sources based on the valuation objectives and stakeholders.
Step 2: Gather data.
Compile information about the business, including a business operations overview.
Aggregate historical business financials, and develop a financial model and financial projections.
Adjust the model and projections, and define sensitivities and scenarios, incorporating risk in conjunction with business management. (Financial statements prepared for tax purposes and audited financials must be interpreted properly and reclassified as appropriate for business valuation use cases.)
Step 3: Research and analyze data.
Perform in-depth analysis of company documents, audited financial statements or tax returns, business operational information, intangible assets, macro and business-specific risk factors, and other data.
Research macro and industry- and business-specific economic factors, industry trends, and risk factors.
Analyze public and private comparable industry transactions and trading multiples.
Step 4: Produce a valuation report.
Design a comprehensive presentation of specific business risk factors.
Draft a detailed company description and establish market positioning.
Generate an industry-specific review and assessment of prevailing economic conditions and trends.
Create detailed historical and projected financial statements in line with business valuation standards.
Contemplate, underwrite, and execute industry-specific valuation methodologies, utilizing best practices for accurate valuation determination. (No two companies are identical, and each business will have a unique scenario and stakeholders.)
Validate all assumptions and results.
Arrive at a customized, comprehensive, and defensible business valuation.
Step 5: Present and review the preliminary report with management.
Present the preliminary business valuation report to enable a thorough understanding of its conclusions, verify accuracy, and ensure the report fulfills its objectives.
Revise the preliminary draft, if needed, and issue the final report with customary disclaimers, representations, and warranties.
What will the deliverables look like?
The candidate should respond that the final report will include a business overview, market positioning, and industry and macrodynamic reviews, as well as supporting documents to validate and justify their results. If you would like the report to include specific information or formatting, request it. Also, ask how the candidate would defend their conclusions if challenged.
Can you describe how you worked through the last similar business valuation?
Ask how recently this valuation was performed. Expect each candidate to detail how they approached the case and note how nuanced their approach seems. The more recent and robust their experience with your kind of use case, the better.
Why do companies hire Business Valuation Specialists?
There are many reasons you may need a thorough, accurate, data-based business valuation of your company. Besides a potential sale, reasons may include partnership buyouts, estate and gift taxes, buy-sell agreements, divorce, corporate litigation, SBA loan applications, raising equity or debt capital, succession planning, stock options/employee stock/ESOP, incentive programs, fairness opinions, tax allocation and tax reporting, and valuing intangible assets. For any of these use cases, hiring a qualified business valuation specialist will demonstrate due diligence and reduce the likelihood of problems resulting from an incorrect or unsupported valuation during or after a transaction.
No matter what size your business is or what industry you’re in, you’ll probably need to hire a business valuation specialist at some point. Being able to describe the nature and scope of your job will help you identify the specialist with the appropriate skills. Hiring the best specialist for your needs will, in turn, make the valuation process go as smoothly as possible.