|5/21/2021 2:22:48 PM ataraxia|
|Glad I can anonymously ask this here. I had all this time had shares in 3 private companies that I had marked at $0 for conservativism's sake. I inherited them from my grandfather when he dissolved the holding company where he held these shares. They're small stakes in moderately sized private companies. I've marked them here at book value now that I've just started receiving the audited financials for these companies, but I'm wondering what the best way to value them would be? Should I even be including them in my net worth calculation?
|5/21/2021 2:24:29 PM ataraxia|
|They're also businesses that would have been severely impacted by covid, so I feel like I want to slash that value in half - Hotels, industrial shipbuilders, real-estate development...|
|5/28/2021 11:34:20 AM HerEveryCentCounts|
|How did you go from 5M to 11M in a few months? Was that the inheritance? |
|5/29/2021 11:05:37 AM ataraxia|
|I actually just changed how I accounted for private shares I have actually held all this time. I have shares in private companies that I previously had marked at a value of $0. I knew they were worth something, but it was difficult to get a market value.
After finally getting around to reading the financial statements, I'm a little more comfortable assigning a $ value to the shares. The accounting department assigns a value that is roughly in line with book value, and implies a valuation multiple relative to earnings that is in line with the industries.
It's probably still a little optimistic to account for it that high since it would be hard to sell my shares, so I'm still not totally confident in including it as an asset. There as no actual 5m inflow these few months. I just finally assigned a dollar value to those private shares.|
|5/31/2021 3:32:19 PM HerEveryCentCounts|
|That makes sense. I always account my shares in private companies at $0 since every startup I've worked for has = $0 after years of trying to not fail. :) So glad to have RSUs now that are actually worth something. Good luck on your private shares being worth $5M. |
|6/1/2021 3:00:44 AM ataraxia|
|Haha yeah. Hard to come up with a reasonable discount factor. That being said, most of these specific shares are in private companies where a large portion of the underlying asset held is actually already publically traded.
There's still a lot in it that's private without an ascertainable marketvalue so for now I'll continue ignoring that portion.|
|6/1/2021 3:37:32 PM br|
|You might reach out to the companies and ask if they have a stock buyback program. It's possible they have a buyback authorization and would tender your shares at a discount. That would at least give you a floor on the value.|