|All Industries, Financial Model, General Excel Financial Models|
|Business Valuation, Financial Reporting, Investors, Management, Private Equity, Valuation, Venture Capital|
This best practice scoring model will allow you to grade a company or a project over 25 attributes broken down in 5 categories (you can, of course, modify the model and increase that number if you’d like).
Every attributes is assessed and given a value that you can personalize (eg. market size => 100k, 500k, 2m, 5m >10m) and each category is correlated to a grade (by default, from -2 up to +2)
Once you have decided on all your attributes and personalized their value, I have also included a column where you will select the respective weight you believe of each attribute should have in the total grade. For instance, if you think that revenue growth should have twice as much importance as the number of product types, then you can choose a weight of 1 for product type and 2 for revenue growth.
The model will then automatically generate a Grade bridge showing the impact of each attribute to the overall grade. To make it more visual and clear, the bridge shows the grade on a scale of -100 to + 100 which allows users to clearly see the negative impact of the attributes with weak values.
The model also includes a spider web chart showing the strengths and weaknesses of the target by category.
Finally in the last section, in the case where you want to use the scorecard to value a company, the overall grade allows you to narrow down the multiple (of revenue, EBITDA, etc.) you want to use based on the range you provide.