Start-Ups and Cash Burn Analysis

I have a few questions related to the valuation/analysis of startups. I am rather green when it comes to startups and have only dealt with companies that are more established, so my questions may seem obvious to some with more transaction experience with this type of company.

(1) At a high level, do you value start-ups the same way you value a normal operating company? For instance, if you are a corporation looking to buy some startups, do you typically use a normal DCF model using projections for x amount of years?

(2) When it comes to burn rates, is this a datapoint that you look at on a monthly, quarterly, or yearly basis? If you were to make 5 year projections, would one typically look at the projected yearly burn rate too?

(3) When determining a terminal value of the business, do you calculate it using a perpetuity growth rate? Do you use an exit multiple off of EBITDA? Multiple of Revenue?

Any insight into the valuation of startups would be greatly appreciated. Thanks.

1 Comments
 

Sunt soluta sit occaecati incidunt quod occaecati placeat. Molestiae officiis dolor et aut. Nisi ipsam blanditiis quo nobis. Voluptas molestias in sunt illo. Ullam vero laborum temporibus odio ad molestias eaque.

Career Advancement Opportunities

June 2026 Investment Banking

  • Evercore 01 99.4%
  • Moelis & Company 01 98.8%
  • JPMorgan 01 98.2%
  • Guggenheim Partners 01 97.7%
  • Morgan Stanley 07 97.1%

Overall Employee Satisfaction

June 2026 Investment Banking

  • Moelis & Company No 99.4%
  • Morgan Stanley 01 98.8%
  • Evercore 01 98.2%
  • BMO Capital Markets 12 97.6%
  • Banco Santander 01 97.1%

Professional Growth Opportunities

June 2026 Investment Banking

  • Moelis & Company No 99.4%
  • Evercore No 98.8%
  • Morgan Stanley 05 98.2%
  • JPMorgan No 97.7%
  • BMO Capital Markets 12 97.1%

Total Avg Compensation

June 2026 Investment Banking

  • Vice President (14) $434
  • Associates (43) $259
  • 3rd+ Year Analyst (8) $210
  • 2nd Year Analyst (22) $179
  • Intern/Summer Associate (13) $156
  • 1st Year Analyst (75) $151
  • Intern/Summer Analyst (67) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
kanon's picture
kanon
99.0
3
BankonBanking's picture
BankonBanking
99.0
4
Secyh62's picture
Secyh62
99.0
5
DrApeman's picture
DrApeman
98.9
6
Betsy Massar's picture
Betsy Massar
98.9
7
GameTheory's picture
GameTheory
98.9
8
dosk17's picture
dosk17
98.9
9
CompBanker's picture
CompBanker
98.9
10
Jamoldo's picture
Jamoldo
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”