Editorial Type:
Article Category: Research Article
 | 
Online Publication Date: 01 Jul 2016

Part II: Appraiser vs. Real-World Debates: The Case for Using Private Capital Markets Data

PhD, CFA, CPA
Page Range: 40 – 51
DOI: 10.5791/0882-2875-35.2.40
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In the 1st part of this series we focused on how appraisers and the real world have such differing views on ‘costs of capital,’ ‘capital access,’ and, thus, valuation. In Part I, entitled “Appraisers vs. Real World Debates: How many appraisers can dance on the head of the private capital market?,” I referenced that there is a considerable gap between reality and the hypothetical, which further limits the strategic value of business appraisals. In this article, we offer insights, data, and approaches to make cost of capital development more relevant.

Copyright: © 2016, American Society of Appraisers
Figure 1
Figure 1

Distribution of U.S. Employer Businesses by Revenue Size (100s)

Figure 2
Figure 2

Public Markets vs. Private Markets

Figure 3
Figure 3

Buyer Type for Business Sales Transactions

Figure 4
Figure 4

Distribution of Publicly Traded Companies by Revenue Sizes

Figure 5
Figure 5

The Relevant Financing Market

Figure 6
Figure 6

Financing Success Rates by Type and Size for Prior Three Months

Figure 7
Figure 7

Private Capital Access (PCA) and Private Capital Demand (PCD) Index Results—Whole Sample

Figure 8
Figure 8

Rates and Return Expectations by Capital Type and Segmentation for Institutional Money: Fall 2013

Figure 9
Figure 9

Owners’ Views: Return Expectations for Personal Investments

Contributor Notes

John K. Paglia is Associate Dean, Associate Professor of Finance, Graziadio School of Business and Management, Pepperdine University, Malibu, California; john.paglia@pepperdine.edu.

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