The Challenge
A GCC-based private equity fund with $340M AUM and 12 portfolio companies across consumer goods, healthcare, and technology needed to upgrade its quarterly valuation process ahead of a planned Fund II raise.
The existing process was time-consuming, inconsistent across companies, and produced outputs that varied significantly in methodology and presentation depending on which analyst had run each company. LP confidence in the numbers was lower than the fund manager wanted going into roadshows for the new fund.
The challenge was threefold: methodological consistency, turnaround speed, and LP-ready presentation quality.
Our Process
We designed and now operate the fund's quarterly valuation cycle as an ongoing managed engagement.
Valuation framework design. We developed a standardised valuation methodology document specifying the approach for each portfolio company by type: revenue-stage companies valued on EV/Revenue with peer comps; EBITDA-positive companies on EV/EBITDA; early-stage on last-round valuation with qualitative adjustment factors. The framework was reviewed and approved by the fund's investment committee.
Company-level valuation models. We built individual valuation models for all 12 portfolio companies, each following the approved framework while incorporating company-specific drivers. Models are refreshed quarterly with the latest management accounts, updated peer comps, and market multiple data.
Peer comparable database. We maintain a rolling database of listed and transaction comparables across the fund's three primary sectors, updated monthly using public market data and selected M&A transaction disclosures. This is the most time-consuming part of the process — and the most important for defensibility.
LP reporting package. Each quarter we produce the fund's valuation report: a 40–50 page document covering portfolio overview, individual company valuations with methodology notes, NAV bridge from prior quarter, and IRR calculations at both deal and fund level.
Key Outcome
The methodological consistency was the primary win for the investment committee. Before the engagement, different portfolio companies were being valued using incompatible approaches — one might use a revenue multiple while a comparable company in the same sector was being valued on EBITDA. The inconsistency made aggregate portfolio analysis unreliable.
With a documented, consistent framework applied across all 12 companies, the fund could now present to LPs with confidence that the NAV was computed on a defensible, auditable basis.
Results
- ·10-day quarterly close from management accounts receipt to LP report delivery — down from 22 days previously
- ·Methodology documentation accepted by the fund's auditors and referenced in the annual audit without qualification
- ·Fund II roadshow: the valuation quality and LP reporting was cited by two LPs as a factor in their commitment
- ·Fund II first close completed at $180M — on track toward a $500M target
- ·Ongoing: TVC manages all 12 company valuations quarterly and supports ad-hoc valuations for new acquisitions and exit transactions as they arise