Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

6 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

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

6 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 2 1 pts Because this investment is very risky, you want to earn a return of at least 40% per year on your investment. What is the Post-Money Valuation? $1,200,000 $6,579,000 $3,356,632.65 O $1,712,567.68 Question 3 1 pts What is the pre-money valuation? $1,112,568 $600,000 $2,756,632.65 $1,200,000 Question 4 1 pts What is your venture capital firm's desired fraction of ownership in the firm? 25.09% O 10.59% 35.04% 40% Question 5 1 pts Suppose that the founders want 150,000 shares. How many shares would your venture capital want? 50,240 100,000 80,894 50,000 Question 6 1 pts What is the value per share? O $7.42 O $12 $6 $35.02 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 2 1 pts Because this investment is very risky, you want to earn a return of at least 40% per year on your investment. What is the Post-Money Valuation? $1,200,000 $6,579,000 $3,356,632.65 O $1,712,567.68 Question 3 1 pts What is the pre-money valuation? $1,112,568 $600,000 $2,756,632.65 $1,200,000 Question 4 1 pts What is your venture capital firm's desired fraction of ownership in the firm? 25.09% O 10.59% 35.04% 40% Question 5 1 pts Suppose that the founders want 150,000 shares. How many shares would your venture capital want? 50,240 100,000 80,894 50,000 Question 6 1 pts What is the value per share? O $7.42 O $12 $6 $35.02

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Options Futures And Other Derivatives

Authors: John Hull

11th Global Edition

1292410655, 9781292410654

More Books

Students also viewed these Finance questions