abstract
- Decisions taken by managers based on traditional approaches could be inflexible since they are based on straightforward criteria. This chapter proposes a general startup business valuation framework based on the Real Options (RO) approach which introduces the ¿Options Cycle for Startups¿ to assess different startup business scenarios. The RO is proposed not as a substitute of the DCF valuation approach, but as a complementary tool for the decision-making process. Even though market conditions may get worse, the RO approach shows that there is always a Time Value in any business decision-making. Results revealed that when DCF rejects a startup investment, the RO suggests that there is a chance to exercise the initial investment at the expiration of each stage of the startup cycle. © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023.