A new study adds to the limited research and quantitative analysis linking consumer brand strength metrics to valuation, as measured by total enterprise value (TEV), with implications for how privately held companies are evaluated and funded.
Led by WestCap, a strategic operating and investing firm with over $6 billion in assets under management, in partnership with Bella Private Markets and brand tracking platform Tracksuit, the study draws on four years of brand tracking data to find that brand strength is meaningfully linked to company value.
Study Overview and Findings
The study, “Is Brand Strength Linked to Firm Valuation? Evidence from Consumer Survey Data,” analyzes monthly brand strength data – from awareness, consideration, investigation, usage, to preference – against TEV for 21 publicly traded companies from December 2021 through April 2026, yielding 611 company-month observations.
“This is a surprisingly understudied area given its significance to how companies are built and valued,” said Josh Lerner, Jacob H. Schiff Professor at Harvard Business School and Managing Partner of Bella Private Markets. “What we are attempting to do is take what has historically been a very inexact science and approach it in a more systematic way.”
The research employs a progressive fixed effects regression framework, controlling sequentially for company-specific characteristics and broader macroeconomic conditions to isolate the independent relationship between brand strength and company valuation. After controlling for various company-specific and time-specific factors, initial research findings suggest that:
- A 10 percentage point increase in brand awareness is associated with a ~17% increase in total enterprise value – equivalent to $170 million for every $1 billion of company value – a relationship that remains statistically significant across multiple model specifications
- A 10 percentage point increase in brand consideration is associated with a ~20% increase in total enterprise value, with consideration among the most robust individual predictors of TEV across all model specifications
- A 10 percentage point increase in brand preference is associated with a ~17% increase in total enterprise value, underscoring that brands actively chosen as the best in their category command a meaningful valuation premium
- Brands that successfully move consumers through the full funnel, from awareness through to consideration and preference, command the greatest valuation premium, suggesting that depth of consumer relationship is ultimately more predictive of enterprise value than breadth of reach alone
“Marketers have always believed that brand health matters to the long-term success of a business, but it’s historically been hard to prove,” said Connor Archbold, CEO, Tracksuit. “What this research does is show that brand metrics can act as an early indicator of where a company’s value is headed, giving brand a rightful place in the boardroom conversation.”
Implications for Investment Decision-Making
The research begins to address a longstanding gap in private market investment frameworks. Widely used valuation metrics — including CAC:LTV ratios and the “Rule of 40” — do not incorporate brand strength as a direct input, despite substantial evidence from public markets that intangible assets, including brand, account for a significant portion of enterprise value.
“Investors often treat brand as a soft asset instead of a driver for business growth,” said Allen Mask, Partner at WestCap and Managing Partner of CōLab, the firm’s in-house creative studio. “This research challenges that assumption directly. It puts empirical weight behind what we have seen inside our portfolio for years with our Operating Equity model. This is the beginning of a much larger conversation about how the investment community should be valuing brand, creativity, and engagement.”
The findings have direct implications for how investors evaluate portfolio companies. For firms that embed operational and creative resources into their portfolios, the research provides a framework for understanding how brand-building activity may translate to enterprise value growth over time.
Expanding the Research
The teams at WestCap, Bella Private Markets and Tracksuit are exploring future studies that expand the scope and scale of this initial study, and welcome collaboration from additional data partners and academic institutions interested in advancing this research.
View the study on the Bella Private Markets website: https://bit.ly/3T6VJzf
About WestCap
WestCap is a strategic operating and investing firm that partners with visionary leaders to build generational businesses. Our team is comprised of seasoned industry leaders and entrepreneurs who guide companies through the most pivotal stages of growth. Some of our notable investments include Airbnb, StubHub, Klarna, Ipreo, Addepar, Hopper, iCapital and GoodLeap. The firm has offices in New York, San Francisco and London. For more information, please visit www.westcap.com.
About Bella Private Markets
Bella Private Markets is a Boston-based research and advisory firm specializing in private capital markets and is led by Dr. Josh Lerner, Jacob H. Schiff Professor at Harvard Business School. Trusted by institutional investors and private capital firms globally, Bella delivers research-backed insights, sophisticated analytics, and strategic guidance to help clients successfully navigate the private market landscape. bellaprivatemarkets.com
About Tracksuit
Tracksuit is the modern brand tracking platform used by consumer brands worldwide to measure and prove the impact of brand-building. Built on rigorous data, Tracksuit gives brands a clear, ongoing picture of their health, tracking how they’re perceived today and how that’s shifting as the ways people discover and evaluate brands evolves. Founded in 2021, the company now operates in 25 markets including the US, Canada, the UK, Europe, Australia, and New Zealand. www.tracksuit.com
View source version on businesswire.com: https://www.businesswire.com/news/home/20260729569322/en/
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