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Charlotte Ventures is thinking of a $6 million convertible preferred investment in a startup, structured as 5 million shares. The founders of the startup
Charlotte Ventures is thinking of a $6 million convertible preferred investment in a startup, structured as 5 million shares. The founders of the startup hold 10 million common shares. There's a 30% probability of an IPO in 5 years, with an estimated exit value of $300 million. Charlotte uses a 15% cost of capital, and its expected retention is 50%. Should Charlotte invest in the startup? 5/2
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