Institutional-Grade ASC 820 Fair Value
Precision fair value measurements for VC & PE portfolios. Multi-method consensus — Backsolve, GPC, M&A, Post-Money — weighted for your capital structure.
End-to-End Process
13-Step Intelligence Workflow
Multi-Method Consensus
Five Valuation Approaches
Weighted based on stage, structure, and market data.
Backsolve Method
Derives implied EV by working backwards from a recent financing round.
GPC Analysis
Benchmarks against publicly traded peers using revenue and EBITDA multiples.
M&A Transactions
Analyzes historical M&A transactions to determine multiples acquirers have paid.
Methods 04 & 05
Completing the Picture
Post-Money Indication
Uses the most recent financing round's post-money valuation as a reference, calibrated for time elapsed and business changes.
Other Indication of Value
Incorporates secondary market data, binding offers, and tender offer prices as observable market evidence.
Equity Allocation
Allocation Methodologies
Allocate enterprise value across all security classes.
Option Pricing Model
Treats each equity class as a call option on enterprise value using Black-Scholes framework.
Current Value Method
Allocates current equity value based on liquidation or conversion preferences.
Common Stock Equivalent
Assumes all preferred shares convert to common at current ratio, allocates pro-rata.
Method Selection Flow
Fair Value
Marketability Discount
DLOM Intelligence Engine
Applied at both company and share class level for maximum audit defensibility.
Company Level DLOM
10–25%Applied to the total enterprise value before allocation. Reflects the illiquidity of the entire business as a going concern.
Share Class Level DLOM
15–35%Applied to each security class after OPM allocation. Common shares typically carry a higher DLOM than preferred.
Chaffe Model
European put option on restricted stock
Finnerty
Average-strike put with lookback feature
Geometric
Path-dependent volatility adjustment
RSR Studies
Empirical data from SEC private placements
Custom
Analyst-defined parameters and hybrid blends
Frequently Asked Questions
How does ASC 820 differ from a 409A valuation?
ASC 820 is a financial reporting standard requiring fair value measurements for GAAP compliance, typically for portfolio valuations, goodwill impairment, and purchase price allocations. 409A valuations specifically address IRC Section 409A compliance for stock option pricing. While both determine fair value, they serve different regulatory frameworks.
What is the fair value hierarchy under ASC 820?
ASC 820 establishes a three-level hierarchy: Level 1 uses quoted prices in active markets, Level 2 uses observable inputs other than Level 1 prices, and Level 3 uses unobservable inputs based on the entity's own assumptions. Most private company valuations fall under Level 3.
How do you handle portfolio company valuations for fund reporting?
We provide quarterly and annual fair value measurements for private equity and venture capital portfolio companies, supporting NAV calculations and LP reporting requirements with calibration-based approaches and market-corroborated assumptions.
What DLOM models does Zimbs Valetex support?
We support multiple Discount for Lack of Marketability models including the Finnerty put option model, Chaffe protective put model, and the Asian protective put model, selected based on the specific characteristics of each engagement.
How are Level 3 inputs documented for audit defense?
All Level 3 inputs are documented with supporting rationale, sensitivity analysis, and calibration to observable market data where available. Our reports include detailed assumption narratives that satisfy auditor documentation requirements.
Ready for Your Next Portfolio Valuation?
Schedule a free consultation with our valuation specialists to discuss your ASC 820 requirements and get an audit-ready quote.