1. Forecast Cash Flows: Estimate the future cash flows for a specific period, usually 5-10 years. 2. Determine the Discount Rate: This rate reflects the risk and time value of money. Commonly, the Weighted Average Cost of Capital (WACC) is used. 3. Calculate Present Value: Discount the forecasted cash flows to their present value using the discount rate. 4. Estimate Terminal Value: Calculate the business value beyond the forecast period and discount it to the present value. 5. Sum of Values: Add up the present values of forecasted cash flows and the terminal value to arrive at the total business value.