What You Need to Know: Contingent Consideration (Earnouts) Valuation

Companies involved in M&A will often use payments based on future performance or milestones to bridge a valuation gap. These earnouts can be very useful for getting deals across the finish line. But they also create unique valuation challenges.

In this on-demand webcast, Josh Schaeffer and Nathan O’Connor discuss common payment structures and the valuation challenges raised by each. We also review appropriate methodologies, aided by insights from the Appraisal Foundation’s working group on the topic. Finally, we look at some key cognitive biases that affect how we assign probabilities to outcomes &mdash and share ways to mitigate these for all walks of corporate planning. This webinar is a must for acquirers, potential targets, and anyone who assists in developing future forecasts.