EBITDA multiple for this industry?

[ThomasCalc]

I've a well-established project (good team and past, audience data, stats, etc.) in the area of video game industry.

The EBITDA at the end of the 3rd year in my business plan is 4,5 million USD. What EBITDA multiple shall I use to estimate the value of the company?

Remember, it's video games (PC games) industry, not casino or real-world gaming. I can't find such data anywhere.

The capital that I ask from the investor in the 1st year is 2 million USD. If the EBITDA multiple is not small, I probably don't need to offer him too much percent (%) share.

 

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[SuiFeng]

It's very unlikely the investor will pay a multiple on the EBITDA after year 3. What's your EBITDA FY 2013, 2014 and first half 2015?

Try to find the multiple of similor quoted players, and correct it for small size and no liquidity. (2x 25%)

You can offer him every small percentage you want, he's probably going to have a different idea about that ;-)

 

[ThomasCalc]

I think there is a misunderstanding here. I'm talking about a Venture Capital investor.

This is only a business plan for a project that the investor likes. I ask money (2M) from the investor, and he gets a share (%) in exchange. So I want to know how much the company will be valued at the end of 3rd year, taking into account the 3rd year EBITDA (4.5M) in the business plan.

(Our team has a good past, but not in this new company. So we have no previous EBITDA values.)

So I don't want to sell him or anyone the company. He would invest money now, and he probably expects a share that will give him an adequate company value at the end of the 3rd year. That is the time when he would exit (Venture Capital).