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4 part question Question 1 1 pts Stacy's Coffee is asking for an investment of $600,000 from your venture capital firm. Stacy's Coffee expects to
4 part question
Question 1 1 pts Stacy's Coffee is asking for an investment of $600,000 from your venture capital firm. Stacy's Coffee expects to have sales of $1,200,000 four years from now. What is your estimate of the terminal value for the company in 4 years? Estimate the terminal value of the company using the sales multiple method. Comparable firms in the same industry have the following Price/Sales ratio: Comparable Companies Ticker Symbol Price/Sales Starbucks SBUX 4.95 Darden Restaurants DRI 2.46 Yum Brands YUM 6.15 McDonald's Corporation MCD 8.37 $10,044,000 $6,579,000 $7,380,000 O $1,200,000 Question 7 1 pts Suppose that the founders of Stacy's Coffee decide that they need $2,000,000 and they want to raise this capital in two rounds. At t=0, your venture capital firm invests $1,000,000, and at t=2, Vulture Ventures invest $1,000,000. Both investors want to earn a return of 40% per year on investment. What is Vulture Venture's desired ownership fraction at t=2? 41.71% 21.28% 58.39% 29.79% What is investor 1's desired ownership fraction at t=0? 40% 25% 59.41% 83.17% What is the price per share at t=0? Assume that the founders still want 150,000 shares. $32.55 O $1.35 O $10 O $4.56 What is the price per share at t2? O $1.68 $2.64 $8.31 O $10 Question 1 1 pts Stacy's Coffee is asking for an investment of $600,000 from your venture capital firm. Stacy's Coffee expects to have sales of $1,200,000 four years from now. What is your estimate of the terminal value for the company in 4 years? Estimate the terminal value of the company using the sales multiple method. Comparable firms in the same industry have the following Price/Sales ratio: Comparable Companies Ticker Symbol Price/Sales Starbucks SBUX 4.95 Darden Restaurants DRI 2.46 Yum Brands YUM 6.15 McDonald's Corporation MCD 8.37 $10,044,000 $6,579,000 $7,380,000 O $1,200,000 Question 7 1 pts Suppose that the founders of Stacy's Coffee decide that they need $2,000,000 and they want to raise this capital in two rounds. At t=0, your venture capital firm invests $1,000,000, and at t=2, Vulture Ventures invest $1,000,000. Both investors want to earn a return of 40% per year on investment. What is Vulture Venture's desired ownership fraction at t=2? 41.71% 21.28% 58.39% 29.79% What is investor 1's desired ownership fraction at t=0? 40% 25% 59.41% 83.17% What is the price per share at t=0? Assume that the founders still want 150,000 shares. $32.55 O $1.35 O $10 O $4.56 What is the price per share at t2? O $1.68 $2.64 $8.31 O $10Step by Step Solution
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