Additional Paid‐In Capital
The price paid by the investor over the par value. If we wanted to raise $20M and the common stock
value is $100,000, the remaining portion is put in additional paid‐in capital. This comes out to $19‐9M.
Alternative Investments An asset that is not a traditional investment, such as a stock or bond.
Alternative investments are usually held by large organizations like pension funds and life insurance
companies. Examples include private equity (venture capital) and real estate.
Annualized Run Rate CARR)
An accurate depiction of company’s forecasted revenue for the year. Generally speaking, take the
amount of revenue that is recurring within the given month and multiply by 12.
Asset‐Based Valuation
Used when a company has no cash flow, is near bankruptcy and preparing to liquidate assets for sale.
Asset‐based valuation also comes in handy when a company’s value can be largely derived from its
tangible and intangible assets. At a high level, take the value of all assets and subtract
the value of all liabilities.

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