Whether you’re comparing companies or similar transactions, having the right data can mean the difference between closing a deal at the right price or missing out altogether. Take the early-stage venture space, for example: While it’s no surprise that valuations are on the rise, the difference between the median and bottom 25th percentile has become increasingly narrow.

The margin for error when analyzing business comps gets even smaller when it comes to PE pricing. Even though GPs have plenty of dry powder, the cost of financing has ticked up. Pair that with competition from corporate acquirers and the result continues to be lofty EV/EBITDA multiples.

So how do you get the hard-to-find data you need—and validate it quickly—to build comps fast and close the right deals? And how do you get the most recent industry figures to stay up to date and quickly complete your models so you can negotiate with confidence?

How you can use PitchBook to gain a competitive advantage

By combing best-in-class private transaction data—including the world’s largest source of deal multiples and valuations—with public fundamentals and consensus estimates, PitchBook enables you to build more accurate comparables with greater transparency and speed. 

“PitchBook helps us arrive at a value that makes the seller feel comfortable, confident and excited about the trade.”

– Brad Fishman, Managing Partner, Manhattan Venture Partners

Get more accurate data for financial models

The private markets are changing faster than ever—which means having accurate, up-to-date financial data to help you inform your investment decisions is essential.

However, it’s easy to make inaccurate comparisons. Many investors use public market comparables to determine the value of a private company, but private and public companies differ significantly, even if they share similar characteristics. This heightens the risk of mispricing a deal, because the differences between public and private companies affect the underlying value of each.

Comparing private companies in a similar growth stage and industry can be much more accurate. That’s why having access to extensive data on private companies—including EBITDA, pre- and post-money valuations, multiples and deal sizes—is so important.

See how financials are calculated

The private markets are known for being opaque, particularly when it comes to deal terms and how valuations are calculated. For years, this information hasn’t been readily available to the public, so investors and advisors have become accustomed to doing business in the private markets using public market data.

Instead of estimating valuations, our analysts use a proprietary formula to calculate a pre- and post-money valuation for each round of a company’s funding.

Similar to how analysts determine market cap for publicly traded companies, our formula accounts for factors such as the number of shares issued and option pool estimates. We also contact each company’s investors and executives to confirm our results. Combined with the detailed deal terms data that’s also available on the PitchBook Platform, we’re able to provide the fullest picture of private financing events possible.

The PitchBook Platform also provides consensus estimates for three forward-looking years covering more than 16,000 companies with contributions from over 800 analysts, including data on EPS, revenue, EBITDA and more.

You can quickly conduct your own due diligence on financial data points by investigating differences in calculated and reported values as well as auditing existing financials back to their source filings. This makes it easy to understand the methodology and calculations behind the financials in the platform and make any adjustments you deem necessary.

Build and analyze comps quickly

Along with accuracy, speed is essential when building financial models. A thoroughly vetted transaction or company comparable analysis won’t do you much good if your target signs with someone else while you’re doing it.

PitchBook lets you to build financial models in a matter of minutes. By allowing you to quickly identify different types of funding rounds, companies and financings, the platform enables you to seamlessly navigate between datasets to find relevant transactions fast.

You can also easily run a screen based on thousands of criteria—like industry, vertical, keyword, deal size, deal type and more—to get to exactly what you need in minutes and delete anything irrelevant with a single click. You can quickly analyze your comps using powerful pivot tables too; or pull them into Excel just as fast.

That means you can step up to the negotiation table with confidence faster, instead of spending hours scrubbing data in Excel.

Want to learn more about how your organization can build better comps with PitchBook? Have a look at our company and deal data.

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