Having an idea of how much your Shopify App business is worth is a powerful knowledge — you know that — but where do you start with this process?
Many Shopify Developers are curious about the value of what they've built or are still building but there wasn't really a reliable source to inform them. The best guesstimate would be some sort of an ARR multiple which is really a very crude metric. Often valuation multiples appearing in blog posts and tweets are masking the reality as the true source of information is only available to a buyer and a seller striking a deal. You rarely get to know what was the actual split of upfront cash and earn-outs etc.
Whilst our main focus is the provision of financing for Shopify App developers, we end up being involved in a large number of acquisitions either via funding or by simply helping our clients and partners to get the best possible outcome in the transaction. It was natural for us to start using our analytical algorithms for the purposes of valuing Shopify App business of various sizes and complexities. We spent many hours building and perfecting our spreadsheet models until we got to the point of having a fairly universal yet accurate data-driven solution.
The rest was history as we’ve built a separate function within our App to derive a discounted cash flow-based valuation augmented by relevant comparables of contracted acquisitions. Our valuation tool is an easy-to-use online App that provides both instant valuation of your business and also a precise one with the key metrics underpinning it.
Seeing a range of value of your business is a great starting point to inform your decisions but don't stop there - wait for an e-mail notification and see the precise valuation of your business. And don't worry about the complexity of the process — we take care of everything in the background and give you the summary of the key drivers behind our valuation method.
You'll know enough to have an informed conversation with a potential buyer or an investor and if there are any questions left, simply give us a shout at firstname.lastname@example.org. Our valuation tool has been trained on a decent-size data-set to provide a solid baseline valuation driven by the cash flow that your business generates.
More importantly, there is a group of experts assisting our programmatic approach. There's no faster way to get your business valuation ready.
Ready to dive in? Go ahead and try our free valuation tool now.
Business Valuation Tool