Three Lenses of Value
Definition
The Three Lenses of Value are the framework the iBD Ownership OS™ uses to help owners understand how their business creates, measures, and realizes value. Every ownership decision should be viewed through all three lenses.
Lens 1: Owner’s Value (DCF) — The discounted cash flow lens. This answers: what rate of return do I need to justify keeping this business as an investment, given the risk? It is the owner’s personal required return based on their unique situation and the company-specific risk they carry.
Lens 2: Market Value (WACC and Multiples) — The “Zillow” lens. This answers: what is the company worth to any buyer on the open market? It uses the Weighted Average Cost of Capital (WACC) and a capitalization rate to derive the market multiple applied to Normalized EBITDA.
Lens 3: Transaction Value (Net Proceeds) — The net proceeds lens. This answers: if I sold the company, what would I actually walk away with after debt, taxes, fees, and deal structure? This is the reality check that separates headline purchase price from what hits your bank account.
Why It Matters
Most owners think about valuation as a single number — “my company is worth X.” The Three Lenses reveal that value depends entirely on whose perspective you’re looking from and what you’re trying to decide. An owner keeping the business needs Lens 1. An owner benchmarking against the market needs Lens 2. An owner considering a sale needs Lens 3.
When you can look through all three lenses, you become a true Capital Allocator. The question shifts from “how do I grow?” to “should I keep this asset or trade it?”
Where This Concept Appears
- Lesson 5 — Introduced as the core framework of Module 2
- Module 2 (Expand Knowledge) — Three full milestone arcs, one per lens, with complete math and case studies
- Case Studies — Advanced Solutions 1.0 and Rockin’ Times valued through all three lenses