409A Business Valuations
Gateway Valuation Consulting provides independent valuations of privately held company stock for purposes of Section 409A of the Internal Revenue Code.
Private companies commonly need a current fair market value of their stock when granting stock options or implementing other equity compensation arrangements. Gateway develops the valuation as of a specified valuation date using the facts and circumstances applicable to the company and its equity.
Purpose of a 409A Valuation
A 409A valuation estimates the fair market value of privately held company stock for use in connection with equity compensation and related tax-compliance matters. The valuation may be used by the company, its board, and its advisors when establishing or updating the value used for stock-option and other equity-compensation purposes.
Company-Specific Analysis
Gateway does not use a generic formula or revenue multiple. The valuation considers the company's financial performance, outlook, capital structure, relevant transactions, market evidence, and other factors affecting the value of the subject stock as of the valuation date.
Depending on the facts, the analysis may include income and market approaches, allocation of enterprise or equity value among classes of stock, and consideration of marketability and other characteristics of the subject interest.
Working With Your Advisory Team
Gateway works with company management, the company's CPA, legal counsel, equity-plan advisors, and other professionals as needed to understand the capital structure, equity compensation arrangement, and relevant facts.
Gateway's role is limited to the independent valuation. We do not design equity compensation plans or provide legal or tax advice.
Professional Standards
Valuation engagements are performed in accordance with the AICPA Statement on Standards for Valuation Services (VS Section 100), as applicable to the engagement.
Discuss a 409A Valuation
If your company needs a 409A valuation or an updated valuation of its privately held stock, contact Gateway to discuss the company, capitalization, timing, and next steps.