Lean startup valuation: an empirical study conducted in Southern Germany

Schubert, Hannes (2016) Lean startup valuation: an empirical study conducted in Southern Germany. PhD thesis, University of Gloucestershire.

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Abstract

This research at hand developed a link between the two disciplines of startup valuation and lean startup principles and thereby provides a new approach to improve future startup valuation processes and outcomes. Extensive data collected in the lean startup process are used as a substitute for missing financial data. The thesis provides a contribution to knowledge by investigating the intersections of the so far separated disciplines as well as answering the related propositions and the development of a completely new valuation framework called the lean startup valuation model (LSVM). The framework has been derived from the literature review as a draft version first and it has been reworked with valuable insights gained through expert interviews and content analysis afterwards. The regional focus is Southern Germany. The literature review confirmed the proposition that early startup investments are everything but a safe bet. Their lack of history and financial data as well as the nonexistence of comparable companies, which could be used as a proxy to derive a valuation, causes serious problems. Therefore many practitioners share the shattering opinion that "the practice of startup valuation by venture capitalists remains a pure «guess» and «alchemy»" (Miloud, Aspelund, & Cabrol, 2012, p. 152). The comparatively new lean startup approach by Eric Ries and Steve Blank delivers a framework to systematically and empirically test new startup ideas and business models using real customer contact, build-measure-learn feedback loops and early prototypes. Although initially designed for entrepreneurs, venture capital investors could use these tools to enrich their valuation models and to compensate for the so far missing variables. The new developed lean startup valuation model could help to reduce expensive mistakes, to calculate better valuations and to make less risky investments. This research is of an explorative, inductive and qualitative nature. Expert interviews and content analysis were used as the methods, the research paradigm is critical rationalism.

Item Type: Thesis (PhD)
Thesis Advisors:
Thesis AdvisorEmailURL
Vignali, Claudiocvignali@glos.ac.ukhttps://www.glos.ac.uk/staff/profile/claudio-vignali/
Ryding, Danielladryding@glos.ac.ukUNSPECIFIED
Additional Information: A print copy of this thesis is available for reference use only.
Uncontrolled Keywords: Lean startup valuation; LSVM; Lean startup; Startup valuation
Related URLs:
Subjects: H Social Sciences > HG Finance > HG4501 Investment, capital formation, speculation
Divisions: Schools and Research Institutes > Gloucestershire Business School > Law, Accounting and Finance
Depositing User: Susan Turner
Date Deposited: 18 Feb 2022 15:15
Last Modified: 18 Feb 2022 15:15
URI: https://eprints.glos.ac.uk/id/eprint/10730

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