Hudl.com is a start-up based in Lincoln, NE. Hudl.com allows for coaches of sports teams of all levels, from young kids sports to college teams, to import their game film to be viewed and studied using Hudls proprietary software. Hudl is in need of another round of financing, and is seeking $2 million from Bluejay Venture Capital (BVC).

The current owners of Hudl expect to sell the company for $40 million in 6 years. In addition, the current owners realize that new shares will need to be issued to BVC, but the current owners would like their resulting stake to remain at the current 1.5 million shares after the round of financing is complete.

John Smith, analyst at BVC, is assessing the investment opportunity in Hudl. Smith decides to use the basic venture capital method to analyze Hudl. Given the riskiness of the investment, Smith uses a discount rate of 35% in the analysis.

7. 7.) What is the post-money valuation for Hudl? (1 point)

8. 8.) What is the pre-money valuation for Hudl? (1 point)

9. 9.) What will be BVCs ownership stake (%) in Hudl after the round of financing is complete? (1 point)

10. 10.) What is the implied share price that share price that BVC is paying for the shares? (2 points)

    (Hint: First calculate the new share count for BVC after the round of financing is complete)