What young BVers need from veteran practitioners

An interesting session—the first we’ve seen anywhere—was a panel of young valuation experts giving their perspectives on the profession. The session was at last week’s Business Valuation & Financial Litigation Super Conference hosted by NACVA.

Soft skills needed: How to communicate with clients effectively is one thing the panel members all agreed they need more help with from their veteran colleagues. The young generation of valuers are very tech-savvy, but interpersonal skills are a different story. Interacting with clients effectively is an acquired skill that needs to be passed down to the new generation of valuers. This can be done through some explanation, but the best way is to teach by doing—experienced experts should include young colleagues in site visits, client meetings, copy them on correspondence, invite them to a client lunch, or anything else where they can observe how to build rapport. This will go a long way toward developing young talent, the panel noted.

Bob Lewis (Visionary Group) moderated the panel of up-and-comers: Ashley DeCress (Marcum), Kevin Foyteck (ABIP), Mary Fernandez (Bodine Perry), and Dalton Hopper (BMSS). The panel made some other interesting comments, and there will be a full recap of this session in the October issue of Business Valuation Update.

2022 Pepperdine report on private cost of capital released

A preview of the “2022 Private Capital Markets Report” was presented at the NACVA’s Business Valuation & Financial Litigation Super Conference last week. The report is the result of a project at the Pepperdine University Graziadio Business School that conducts an annual survey of expected rates of return with respect to private companies. Respondents include senior lenders, asset-based lenders, mezzanine funds, private equity groups, venture capital firms, angel investors, privately held businesses, investment bankers, business brokers, limited partners, and business appraisers.

At the conference, Dr. Craig Everett, the project’s director, discussed the report and handed out the full 2022 report to attendees.

Latest ranges: Bank loans have the lowest average expected returns (a median return of 4.0% to 6.0% depending on loan size) while capital obtained from angels has the highest expected returns (ranging from a median of 33% for later-stage financing to 43% for seed money). The full report contains details on each type of funding and at various levels. The “money shot” is a grid chart showing the ranges of returns the various respondents expect at various levels.

The 2022 annual report is available for purchase if you click here.

Divorce Highlight: Hitchner’s wrath continues regarding Damodaran’s attacks

Speaking at the NACVA’s Business Valuation & Financial Litigation Super Conference last week, Jim Hitchner (Valuation Products and Services) continued his strong rebuttal of some severe criticisms Aswath Damodaran (New York University Stern School of Business) made during a recent BVR webinar about certain inputs to the cost of capital (see prior coverage here). “He’s attacking our profession,” Hitchner noted, and he will continue to vent his anger at the upcoming AAML/BVR Divorce Conference in Las Vegas (September 18-20), so the fireworks will continue! Hitchner will co-present two sessions: How to Attack and Defend the Databases Valuation Analysts Use and Ethical Quandaries: An Interactive Session. The AAML is the American Academy of Matrimonial Lawyers. Conference attendance is expected to be half experts and half attorneys. To see the full agenda and to register, click here. Up to 20 CPE/CLE credits are available.

Reminder: Please take a short survey on financial benchmarking data

Our thanks to those of you who took our very short survey (four questions) on the sources valuation analysts use for financial benchmarking data. If you haven’t taken the survey, it will just take a few minutes and we would greatly appreciate it. All responses are anonymous and confidential. You can take the survey if you click here. Thank you!

Global BV News

Sustainable value is the focus at the IVAS-IVSC conference October 6-7

The leading business valuation conference in Asia Pacific has been the IVAS-IVSC Business Valuation Conference, and the next one will be October 6-7. The focus will be on new strategies to safeguard sustainability, such as environment, social, and governance (ESG) factors. The Institute of Valuers and Appraisers, Singapore (IVAS) organizes the event in partnership with the International Valuation Standards Council (IVSC). Sponsors and supporting partners include the Big Four and valuation professional organizations including RICS, AICPA, and the CBV Institute. For more information and to register, click here. Early bird pricing is available until Septem