Why Two Valuers Can Value the Same Company Differently, And What That Actually Means

A founder recently forwarded us two valuation reports for the same company, prepared just weeks apart, with figures that differed by nearly 30%. His question was direct: which one got it wrong?

Neither did. That’s often the least expected answer, but it’s the accurate one. Valuation is commonly treated as a precise, formulaic exercise, when in practice it’s a professional opinion of value, arrived at through a defined method and a set of reasoned assumptions.

Two qualified valuers can look at the same financial statements and the same market and still land on different numbers. This piece explains why that happens, and what it means when you’re the one reading the report.

A Valuation Is an Opinion, Not a Fact

Even a well-supported opinion still needs a starting point. A valuation report gives you exactly that, on a specific date, for a specific purpose. It’s not a fact sitting out there waiting to be discovered, like the boiling point of water.

Two qualified valuers can look at the same balance sheet, the same growth story, the same industry, and still land in different places. Same inputs, different professional judgment. That’s built into the process, not a flaw in it.

They Might Not Even Be Using the Same Method

There are a few standard approaches to valuing a company, and each one tells a slightly different story.

• Discounted cash flow, which values the business on what it’s expected to earn in the future
• Comparable company analysis, which looks at what similar businesses are trading or selling for
• Asset-based valuation, which adds up what the company owns and subtracts what it owes

A DCF-heavy valuation leans on projections. A market comparable approach leans on what buyers are actually paying elsewhere. One valuer might weight these three differently than another, and that alone can move the final number quite a bit. It’s why corporate valuation engagements often specify upfront which method should carry the most weight.

The Assumptions Are Doing More Work Than You’d Think

Even when two valuers use the exact same method, the assumptions inside it rarely match. A discount rate that’s half a percentage point higher or lower changes the output more than most people realize. So does a growth assumption for year three, or how much weight gets given to a bad quarter versus a strong one.

None of these are made up. They’re reasoned, defensible choices. But reasoned and defensible doesn’t mean identical.

The Purpose of the Valuation Changes the Answer

A valuation done for a funding round is not answering the same question as one done for ESOP purposes, and neither of those is the same as one done for a tax filing, a merger, or FEMA valuation advisory work. The purpose shapes the standard of value being used, and the standard of value shapes the number.

So if you’re comparing two reports and wondering why they don’t match, the first question worth asking isn’t which method they used. It’s what the report was actually for.

Judgment Calls Nobody Puts in the Executive Summary

There’s a layer of the process that doesn’t show up as a line item anywhere. How much credit to give a founder’s five-year plan. Whether a competitor’s recent funding round is actually comparable. How to price in the risk of one big customer walking away.

These calls come from experience, and experience varies. That’s not a knock on either valuer. It’s just what happens when you ask a human being to make dozens of judgment calls that all feed into one final figure.

So Which Valuer Is Right?

Probably both, within reason. Valuation professionals generally think in terms of a defensible range rather than one sacred number, and if two reports land within that range, that’s actually a healthy sign, not a red flag.

What matters more than matching the two exactly is understanding why they differ. A well-written report will walk you through its method and its assumptions clearly enough that the gap makes sense once you see it.

What This Actually Means for You

If you’re raising funds, going through a merger, or issuing ESOPs, don’t panic the moment two numbers don’t align. Ask instead what each valuer assumed, what method carried the most weight, and what the report was built for.

• Check the valuation date, since even a few months can shift the number
• Ask which method was given the most weight and why
• Look at the growth and discount rate assumptions, not just the final figure
• Confirm the report matches the purpose it’s being used for

If you’re comparing reports from two different valuers, ask each one to walk you through their assumptions side by side. And if you’re already working with an accounting firm for your compliance work, loop them into the conversation, since they usually know the context behind the numbers better than anyone new to the file.

A good valuation professional will walk you through this without hesitation. If they can’t explain where their number came from, that’s a bigger concern than the number being different from someone else’s.

Final Thoughts

Two valuers landing on different numbers for the same company isn’t a sign that something went wrong. It’s a sign that valuation is judgment applied to uncertainty, done by people who are trained to make that judgment as sound as possible.

What you should actually be looking for isn’t a perfect match between two reports. It’s a report you can trust because you understand how it got there.

At ValuGenius, we spend as much time explaining our assumptions as we do calculating the number itself, because a valuation only holds up if you understand why it says what it says.

Why Choose ValuGenius?

ValuGenius is not just another Valuation Business. We work closely with entrepreneurs, startups, SMEs, and growing enterprises to deliver:

• Accurate and compliant business valuation services
• FEMA valuation advisory for foreign investment transactions
• ESOP valuation for growing teams
• Strategic financial advisory and corporate valuation support

As one of the emerging CA firms in Mumbai, we work alongside financial planning companies and understand both the numbers and the bigger business picture. Whether you need the depth of a full accounting firm engagement or focused valuation services in Mumbai, our chartered accountants in Mumbai walk you through the assumptions behind every report.

We believe valuation is not just about today’s numbers. It’s about tomorrow’s growth story.