Valuation of a Fast-Growing B2B Software Company

Case Study

April 16, 2019

Situation

An early stage business-to-business (B2B) software company focusing on the construction industry raised $21.6 million in venture capital funding one year. Management was approached by additional investors but wanted to issue options to some of its executive team before the next round of funding.

Cherry Bekaert’s Guidance

The company asked Cherry Bekaert to provide valuation services primarily for tax purposes to ensure its compliance with IRC Section 409A when setting the strike price for the newly issued options.

Result

The Valuation team quickly responded to the client’s needs during the holiday season. Team members worked with the company’s vice president of finance to obtain necessary information such as updated forecasts, and they were able to complete the valuation under a tight deadline and have it approved by the board.