Answered step by step
Verified Expert Solution
Question
1 Approved Answer
A high growth company raised $10,000,000.00 in capital from a venture capital firm in the early growth stage of funding.The pre-money valuation of the company
A high growth company raised $10,000,000.00 in capital from a venture capital firm in the early growth stage of funding.The pre-money valuation of the company at the time the capital was raised $20,000,000.00.The terms of the investment also had an annual dividend of 8% and an exit preference of 1.2X upon a liquidity event.Based on these facts please answer the following questions.
- After the closing of the capital funding what was the post money valuation and the venture capitalists percentage of ownership.
- Presuming the company sells for $100,000,000.00 what would the venture capitalist receive in proceeds?
- Presuming the company sells for $27,000,000.00 what would the owners (company) receive in proceeds.
- Presuming the company sells for $100,000,000.00 but also has $10,000,000.00 of debt on the balance sheet, what will the owners receive in proceeds?
this is based on the facts provided. there is no more information to give.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started