The valuation analysis I released on the Facebook IPO two years ago proved popular, so I figure why not do it again for the hottest tech IPO planned this month: Alibaba.

Please refer to my earlier piece on this topic for an explanation of the various valuation methodologies. Also, please note that my objective in releasing this model is not as a buy or sell recommendation on Alibaba, but rather as a concrete example to illustrate one of a VC’s most common valuation techniques: the Comparables method. This method has a number of limitations, especially pertaining to Alibaba. For example, this method does not capture the psychological element surrounding the IPO of one of the largest companies in the world’s largest market, nor the euphoria in China for this company. On the flip side, the model also does not take into account the unconventional governance structure of Alibaba, such as the voting rights and the variable-interest entity mechanism (an arrangement in which a foreign-owned entity strikes an agreement with Chinese companies to own assets that can’t be directly owned by foreigners).

The image below links to my valuation model for Alibaba based on the Comparables method which you’re welcome to borrow. I left it in PDF format for legibility, but if you’d like the Excel version feel free to ask (note: a big thanks to my intern Junjie for helping pull together the underlying financial data).