Financing can come from various sources, including banks, private placements, venture capital or private equity firms. The need for financing is usually driven by start-up expenses, expansion, acquisitions, working capital needs, purchase of goods from suppliers or bonding needs. Financing is granted always in the form of either debt or equity, but each financing can take on unique structural and contractual features, which will impact its ranking and risk/reward profile.

You have selected a target business, which is a privately held business, to look at more closely for a potential acquisition. This article aims to give a brief overview of what type of data you can expect review to enable a determination of the financial condition of the business, and what figures you will use to conduct your business valuation.