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Apex Venture Partners, a VC firm, is planning to invest $7 million today in a startup entrepreneurial firm, Russel Holdings. The VC expects the firm
Apex Venture Partners, a VC firm, is planning to invest $7 million today in a startup entrepreneurial firm, Russel Holdings. The VC expects the firm to have an exit (IPO) valuation of $300 million in four years and has a discount rate of 30%. The number of shares currently outstanding in Russel is 3 million shares. Calculate the post and pre-money valuations, the stock ownership required by the VC, the price per share, and the number of shares the VC will get based on this valuation.
III. (i) Apex Venture Partners, a VC firm, is planning to invest $7 million today in a startup entrepreneurial firm, Russel Holdings. The VC expects the firm to have an exit (IPO) valuation of $300 million in four years and has a discount rate of 30%. The number of shares currently outstanding in Russel is 3 million shares. Calculate the post and pre-money valuations, the stock ownership required by the VC, the price per share, and the number of shares the VC will get based on this valuationStep by Step Solution
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