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2021 | OriginalPaper | Chapter

3. Profitability, Intangible Value Creation, and Scalability Patterns

Author : Roberto Moro-Visconti

Published in: Startup Valuation

Publisher: Springer International Publishing

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Abstract

Startup profitability is a core issue of financial statement analysis and corporate finance. Economic profitability, deriving from positive marginality where revenues exceed costs, is considered in complementary ways. Return on equity (ROE), Return on Invested Capital (ROIC), Return on sales (ROS), and other ratios are systematically illustrated, together with their interactions. Economic Value Added (EVA) represents the value created over the required return of the company’s shareholders, i.e., the net profit less the equity cost of the firm’s capital. Cumulated EVA builds up the Market Value Added (MVA).

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Metadata
Title
Profitability, Intangible Value Creation, and Scalability Patterns
Author
Roberto Moro-Visconti
Copyright Year
2021
DOI
https://doi.org/10.1007/978-3-030-71608-0_3