Question
Q) A venture capital firm wants to invest in your venture called COMM387.com that you started 4 years ago. For COMM387.com, the venture capital firm
Q) A venture capital firm wants to invest in your venture called "COMM387.com" that you started 4 years ago. For COMM387.com, the venture capital firm is using a target annual compound rate of return of 35%. You expect to sell COMM387.com for $10 million in 6 years and you own 100,000 shares now.
1. How much money should you ask from a venture capital firm in exchange for 60% ownership stake in your company?
2. What is the share price of COMM387.com at which the venture capital firm will be buying shares in this case?
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Financial Institutions Management A Risk Management Approach
Authors: Anthony Saunders, Marcia Millon Cornett
9th edition
1259717771, 1259717772, 9781260048186, 1260048187, 978-1259717772
