Market Approach

The market approach is a method of valuation used to determine the worth of a company’s intangible assets by comparing them to similar assets recently bought or sold in the marketplace. Imagine you’re looking to value your company’s brand. With the market approach, you would examine recent transactions of similar brands to see what prices they were sold for. By analysing these transactions and considering factors such as industry trends, market demand and the specific attributes of your intangible asset, you can derive an estimated value. This approach allows CEOs to gain insights into the value of their intangible assets based on real-world market activities, even without accounting expertise.