IPEV 2025, Fair Value & Calibration, Explained
Behind every credible private valuation sits a rulebook. The IPEV 2025 guidelines define how private equity and venture capital investments should be valued, and their central message is uncomfortable for anyone hoping a valuation can sit still: it can’t.
The International Private Equity and Venture Capital Valuation (IPEV) guidelines are the reference framework for valuing private-capital investments. Their 2025 edition, applicable to reporting periods from 1 April 2026, is principles-based rather than rules-based: instead of prescribing one formula, it sets out how to think, and leaves the practitioner to choose methods that fit the situation. That flexibility is essential in private markets, where the clean inputs that standardised models assume are usually missing.
What fair value actually means
The concept at the centre of everything is fair value, defined in line with IFRS 13 as the price at which an asset would change hands between knowledgeable, willing and independent parties in an orderly transaction at the measurement date. Three things follow from that definition, and each one trips people up:
- It is market-based, not investor-specific. Your particular strategic synergies or preferences are not part of fair value.
- It is hypothetical. For most private companies there is no observable market price, so fair value is a best estimate of what one would be.
- It is a point in time. Fair value is measured as of a date and must move as conditions move.
Fair value is not “what we paid” or “what we hope to exit at”. It is what an independent buyer and seller would agree on today, given everything currently known.
Why the last round stops being fair value
The most consequential shift in the 2025 guidance is its insistence that the price of the most recent financing round is a starting point, not a permanent answer. Earlier practice often treated the last round as a stable reference; IPEV 2025 says plainly that holding a valuation unchanged over time, without re-examination, generally does not meet the fair-value standard.
In practice, investors increasingly decline to rely on prices much older than 24 months, and in the neighbourhood of a crisis, even a price three to six months old may need justification. Markets move, and a fair value that ignores that movement is not fair value; it is wishful accounting.
Calibration: the discipline that keeps it honest
Calibration is the bridge between an observed transaction and an ongoing fair value. You begin by aligning your valuation model to a known anchor, typically the price of a recent round, so that, on day one, the model reproduces that price. Then, in every subsequent period, you ask whether the inputs that justified it have changed: the company’s operating performance, the competitive environment, and macro factors such as interest rates and capital availability. If they have, the valuation moves with them.
| Factor | Assessment | Adjustment |
|---|---|---|
| Growth | Above average | +20% |
| Capital efficiency | Below average | −10% |
| Market position | Neutral | 0% |
| Liquidity (private) | Illiquid | −25% |
| Net adjustment | , | −15% |
Far from being a fudge, these adjustments are an integral part of a sound valuation, the explicit reasoning that turns a borrowed market multiple into a defensible, company-specific number.
No single “best” method, triangulate instead
IPEV deliberately refuses to crown one method. Three approaches are recognised, market (multiples), income (DCF and its variants), and cost, and the guidance asks you to select whichever best fits the circumstances, often using several in parallel and triangulating the results. The fair value is not a mechanical average of the methods, but the figure that best represents reality given everything you know. For the methods themselves, see multiples and DCF & the VC method.
Complex cap structures count. IPEV 2025 also stresses that share-class rights, liquidation preferences, anti-dilution, control terms, materially affect what each stake is worth. A headline valuation says nothing about the split. See Liquidation Preferences & the Cap-Table Waterfall.
How DealMatrix operationalises IPEV 2025
IPEV’s demand for continuously recalibrated, market-based valuations is hard to meet by hand. DealMatrix is built around it: every component of its multiples is refreshed quarterly against current public-market data, so static, time-invariant multiples, which the guidelines explicitly discourage, never creep in. The result is a benchmark that is fair-value-consistent by construction.
IPEV-2025-compliant by design.
DealMatrix recalibrates every multiple to current market data each quarter, giving you a fair-value benchmark you can put in front of an auditor.
Sources & further reading
- IPEV (2025). International Private Equity and Venture Capital Valuation Guidelines.
- IFRS 13. Fair Value Measurement.
- Lincoln International (2026). IPEV Guidelines Update Insights.
- DealMatrix (2026). Multiples Methodology, IPEV 2025 compliance.