Over the past year, we’ve seen a clear shift in expectations around how Fair Value is assessed for venture-backed investments and auditors are increasingly at the center of helping clients navigate this complexity. The latest December 2025 IPEV Guidelines reinforce something many of us have been discussing for a while: headline valuation ≠ Fair Value. Simply taking last price per share × number of shares held - regardless of share class rights and preferences is no longer suf

Venture capital investments rarely follow a straight, predictable path. Instead, they move through distinct phases—moments where a company’s trajectory, risk profile, and market context shift in ways that require us to rethink fair value. Each stage demands a different lens, because what a market participant would pay (or expect) evolves as uncertainty unfolds. In this series, I’ll explore these valuation moments through the frameworks that guide our industry: IPEV , ASC 820

1️⃣ There are three core methodologies venture valuations rely on Under IPEV and ASC 820, three frameworks dominate fair value analysis for VC-backed companies: PWERM, OPM, and CVM. Each approaches the valuation problem from a different angle and is suited to different circumstances. 2️⃣ PWERM models real exit scenarios The Probability-Weighted Expected Return Method (PWERM) values a company by modeling discrete outcomes, even incorporating future anticipated funding rounds,