• About
  • My Story
  • The Book's Story
  • Making it your story
• Chapters
  • Setting the stage
    • The story begins (1)
    • Allure of Stories (2)
    • Story Mechanics (3)
    • Allure of Numbers (4)
    • Playing Moneyball (5)
  • Story to Numbers
    • Telling a Story (6)
    • Testing the Story (7)
    • Bridge to Numbers (8)
    • Numbers to Value (9)
    • The Feedback Loop (10)
  • Reacting to News
    • Narrative Deltas (11)
    • News Effects (12)
    • Macro Stories (13)
  • The Rest of the Story
    • The Life Cycle (14)
    • Focus Shifts (15)
    • The Story Ends (16)
• Companies
  • The Stars
    • Uber
    • Ferrari
    • Amazon
    • Alibaba
  • The Supporting Cast
    • Theranos
    • Apple
    • Facebook
    • Vale
    • Valeant
• Material
  • My Writing
  • My Videos
  • My Data
  • My Tools

 

If you buy into the premise of this book, i.e., that valuation is a craft that requires storytelling and number crunching to bring it together, you will be looking for tools. I must admit that I don't have very many on the story telling side, since I am still learning. On the number crunching side, though, I can offer help and I have listed a few items below.

My spreadsheets
Rather than drowning you with the entire list, which you can find on my website at this link, I will list only one, with a webcast on how best to use this spreadsheet to use in valuation.

1. Spreadsheet to value company (with narrative link built in)
2. Webcast to accompany spreadsheet

Probabilistic tools
During the course of the book, I listed probablistic tools that you can use to improve and discipline your story telling and valuation. The list of tools below is not meant to be comprehensive and I have no financial interests in any of them. My only reason for listing them is that I have enjoyed using them in valuation and I hope that you do too. If you find other tools that I am not aware of, please let me know and I will add them to this list.

1. Crystal Ball: This is an Excel add-in that allows you to convert a typical "point estimate" valuation into a Monte Carlo simulation. It is useful to not only get a distribution of values for your company but also to open yourself to how much uncertainty can affect your value judgments. It is powerful and easy to learn and the only negative thing I can say about it is that it does not have a Mac version, requiring me to run my Mac as a PC. You can download a full-fledged trial version at this link on the Oracle site.
2. SPSS: When working with big data, as is often required to get a measure of a sector, business or market, you will need statistical power. While Excel does offer you a limited selection, you will find yourself running out of both firepower and patience quickly. The statistics package that I use is an IBM product. SPSS, a powerful and relatively easy to use statistics program. It is available for both Macs and PCs and you can find a link to it here.

Graphics and Presentation
When a valuation is just about the numbers, presenting it may be easy, but when you are telling a story and connecting it to numbers, how you present it can make a big difference in whether both story tellers and number crunchers make the connections.

1. Presentation Program: Much as I love all things Apple, I have to tip my hat to Microsoft and confess that I still use Powerpoint to present my valuations. If you prefer Keynote, that is perfectly okay.
2. Graphing and Pictures: If a picture is worth a thousand words, it is even more effective in presenting valuations. It allows you to show the numbers that drive the value and connect them to your story about the company. I don't have any strong preferences here, since there are so many good programs out there, but I am finding that my tablet (I have an iPad) is more suited for drawing pictures than my laptop.

An App for your Apple devices
In partnership with my good friend and colleague, Anant Sundaram, finance professor at Dartmouth, we have an App for your iPhone and iPad that allows you to do the number crunching on either device. Since neither of us is capable of writing code for an app and we have resolved to give the app away for free, the resources that we can bring to bear to improve and update the app is limited. At some point, though, we would like to see the story telling incorporated into the app.