A Study on the Estimation of Discount Rate for the Technology Valuation of Small-Sized Venture Firm

중소벤처기업의 기술가치평가를 위한 할인율 추정에 관한 연구

  • 성웅현 (한신대학교 정보통계학과) ;
  • 양동우 (호서대학교 벤처경영학과)
  • Received : 2004.10.12
  • Accepted : 2005.03.16
  • Published : 2005.06.01


The reliability of technology valuation depends on, among other things, the reliability of the discount rate estimate. The weighted average cost of capital, generally accepted as discount rate, consists of cost of equity and cost of debt. The model used to estimate the cost of equity for publicly traded firms can not be used directly for small-sized venture firms. In addition, the estimation of cost of debt become very difficult, given the limited and volatile price history, because these small-sized venture firms do not have associated credit ratings. Since two kinds of cost of capital for the small-sized venture firms can not be estimated directly from market data, this study suggests statistical frame works for estimating unknown two kinds of cost of capital. The estimates of underlying cost of capital will help determine the size of appropriate discount rate with logical and scientific way when the technology valuation for small-sized venture firms is made. This study also suggests the necessity of the risk premium for the technology competitiveness to improve the estimation of the appropriate discount rate for small-sized venture firms.