F2C – An Innovative Approach to Use Fuzzy Cognitive Maps (FCM) for the Valuation of High-Technology Ventures
2011 (English)In: Communications of the IBIMA, ISSN 1943-7765, Vol. 2011, no Article ID 483882, 1-14 p.Article in journal (Refereed) Published
We propose a novel method - F2C - that can process the only information available in the early stages of a young high-technology venture: linguistic expert knowledge. This knowledge is the basis for the determination of an appropriate discount rate for the valuation of high-technology ventures in early stages of venture capital investments. A specific tool named Fuzzy Cognitive Map (FCM) is used therein to capture and depict the expert knowledge. Consequently, the FCM is transformed into a system of Fuzzy Inference Systems. These systems allow eventually obtaining a crisp value for the crucial parameter, the discount rate r. First practical applications were carried out valuing a biotechnology venture. The obtained results are promising, though the need for further research efforts became obvious.
Place, publisher, year, edition, pages
2011. Vol. 2011, no Article ID 483882, 1-14 p.
Fuzzy Cognitive Map, Venture Valuation, Fuzzy Systems
Social Sciences Economics and Business
IdentifiersURN: urn:nbn:se:liu:diva-77666DOI: 10.5171/2011.483882OAI: oai:DiVA.org:liu-77666DiVA: diva2:528301