Valuing Negative EBITDA | Dataford Interview Questions

Your question is Valuing Negative EBITDA. Take a moment with it on the right.

Talk me through your thinking if you like. When you're confident, submit your answer and I'll grade it like a real screen (7/10 or better passes).

Problem

How do you value a company with negative EBITDA?

Asked in the Superday: associate rounds, 2 x 30 min stage. This was a valuation technical question during Superday associate rounds.

Explain which valuation methods remain usable, how you would select an appropriate metric, and how you would cross-check the result. Use the illustrative inputs below only to demonstrate the mechanics.

Illustrative Inputs

Item	Amount
Revenue	$100 million
Gross profit	$60 million
Forward revenue growth	30%
Selected EV / revenue multiple	6.0x
Net debt	$50 million

Task

Explain why EV / EBITDA is not meaningful.
Calculate an illustrative enterprise value and equity value.
Describe a DCF or forward profitability cross-check.
State the key sensitivity and limitation.

Constraints: Treat the figures as illustrative only. Use standard investment banking valuation conventions and USD.