Myths and Truths About Business Valuation
Congratulations to Alina Niculita for publishing another article in the Portland Business Journal, Financial Services Guide.
While most people understand real estate appraisal, the same cannot be said about business appraisal or business valuation.
Real estate appraisal makes sense because it puts a price on houses and commercial properties, which are tangible assets and can be easily accepted as “valuable.” On the other hand, businesses and business interests are often more abstract and less tangible, which can be puzzling. How can something that can’t be seen or touched be valuable?
Some businesses may have low tangible assets, and yet, can be very valuable because of their intangible assets such as client relationships, trademarks, or patents. In fact, ownership of a business interest does not imply ownership of the tangible assets of the business; instead, it gives the owner a bundle of intangible rights and obligations.
Because of such unique characteristics of businesses and business interests, business valuation can be confusing and often misunderstood. This article looks at some common myths about business valuation.
Read the rest of Alina’s article here: