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please help out the question on 2nd and 3rd slide Example Alan Garner has always been fascinated with personal flight and jet packs. After witnessing
please help out the question on 2nd and 3rd slide
Example Alan Garner has always been fascinated with personal flight and jet packs. After witnessing the recent string of Mark Zuckerberg and Facebook's fantastic acquisitions, he decides it's time to create the jetpack, and company to market and sell it, he's always dreamed of. Alan invests $50,000 of his own money to incorporate Lone Wolf Jetpacks and start development of the product. In return for this seed money, Alan is awarded 10 million shares in the firm. After 3 months of development time and some initial test flights, angel investor Jeff Bezos (of Amazon.com fame) hears of Alan's personal jetpack. He is interested in the technology to support Amazon.com's ongoing development of their Prime Air service, in which unmanned aerial vehicles are used to deliver customer orders within an hour of ordering. Mr. Bezos offers to invest $250,000 in return for 20% of the company. 1 Example l If new equity is issued to Mr. Bezos, how many shares are now outstanding and what is the post-money valuation of the firm? How much is Alan's share of the firm worth? 2 Example Investor Round Doug Billings VC, LLP Series C .50 Series D 1.25 Series E 2.75 Phil Wenneck Capital, LLP Stu Price Partners, LLP Price ($) Number of Shares 2,000,000 1,250,000 1,000,000 Over the course of the next nine months, several venture capital firms invest in Lone Wolf Jetpacks. The following table presents the terms of each deal (round E occurs 1 year after Mr. Bezos initial investment): After Series E financing, what is each equity holder's share of the firm? What is the total value of the firm, and what is the value of each owner's share? 3Step by Step Solution
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