1. Calculate your TTM/LTM – last twelve month total revenue. Example today is September, so calculate from august to last year august.
2. The total revenue is usually in Asia multiplied by around 6 to 8 times.
Example total revenue – Rm100, 000. So now your valuation at this point of time will be around 600,00 or 800,000 based on x6 or x8.
This Rm600,000 will be called your pre money valuation.
If they take 10% stake then they must put in Rm60, 000 cash into the business.
Pre money valuation = Rm600,000
Post money valuation = Rm600, 000 + Rm60, 000. So now your new valuation is Rm660, 000.