C. One year goes by. The Team decided to make their startup more scalable. To achieve that goal, they realize that they need to secure venture capital funding. A local VC firm, Garage Capital, is interested in investing in eEdu. GC proposed the following terms for their investments:

• 25% equity stake for $1 million in investment
• 2X liquidation preference with full participation rights
• Two board seats to form a five members board along with Alice, Bob, and Carlos
• Standard preferred shareholder rights for Garage Capital

6. Construct the revised pro forma capitalization table if eEdu were to receive funding from Garage Capital. (3 pints)

Name	Paid in Capital	# of shares	Ownership %
Alice
Bob
Carlos
Garage Capital
Total

7. What is eEdus pre- and post-money valuation for GCs investment round? (2 points)

8. How much is Alices ownership worth on paper? (1 point)

9. Another year goes by. eEdu receives an acquisition proposal by a large online education company for $10 million in cash. If eEdu accepts the proposal, how much would Alice, Bob, Carlos, and Garage Capital get in cash? (2 points)