Final answer:
The traditional approach towards the valuation of a company takes into account the risks involved in the early stages of a company.
Step-by-step explanation:
The traditional approach towards the valuation of a company assumes that until the company is up and running, most people would not pay very much for the stock because of the risks involved. This means that the valuation of a company takes into account the uncertainties and potential obstacles that a company may face in its early stages.