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QUESTION 4 #4-8 A VC firm wants to invest $4.0 million in Making Stuff Corp., a startup firm. Making stuff is expected to go public
QUESTION 4 #4-8 A VC firm wants to invest $4.0 million in Making Stuff Corp., a startup firm. Making stuff is expected to go public in 4 years. Earnings are not projected until year 4, and are projected to be $3 million in year 4. Comparable firms are trading at P/E ratios of 20x. Making Money has 2.5 million shares of stock outstanding. The VC firm has a required rate of return of 40%. Calc the post - money valuation (today). (answer in whole S. Do not round to millions.) QUESTION 5 What is the VC % ownership at exit? (calc as % and round to 1 decimal) QUESTION6 What is the Pre-money Valuation? (answer in whole numbers. do not round to millions) QUESTION 7 What is the implied current price/share? (round to 2 decimals) QUESTION 8 How many new shares will be issued? (answer in whole numbers. do not round to millions)
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