A lot of DCF videos or learning I have seen is focused on public markets.
When calculating the cost of equity for a private business, how would you calculate/what is the substitute to Beta?
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You use the bottom up approach looking at comparable companies to estimate a private company's cost of equity. Find peer set, unlevered beta, and relevered back up to your companies capital structure, from there you can add some adjustments including, a size premium, and company risk.
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