Office Helpers is a private firm that manufactures and sells office supplies. The firm has limited capital and is estimated to have a value of $80 million with the capital constraints. A venture capitalist is willing to contribute $20million to the firm in exchange for 30% of the value of the firm. With this additional capital, the firm is worth $120million. a. Should the firm accept the venture capital?

b. At what percentage of firm value would you (as the owner of Office Helpers) break even on VC financing?