Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Read the Lovepop Case After reading the case prepare comparative capitalization tables for the Founder.org and Techstars Boston offers using the template and following

image text in transcribed

Read the Lovepop Case After reading the case prepare comparative capitalization tables for the Founder.org and Techstars Boston offers using the template and following assumptions: 1) The founders own 10 million shares of common stock. 2) Techstars will purchase 6% of common stock for $18,000 (case Exhibit 6a). 3) In both offers, the company's valuation cap to be employed for the convertible notes will be $3 million. Assume that all convertible notes have the following direction for how to calculate the capped price per share: The capped price per share is calculated as the quotient resulting from dividing the valuation cap by the number of outstanding shares immediately prior to the Series A round of financing, including all shares of common stock reserved and available for future grant under any equity incentive or similar plan to be created with the Series A round of financing, excluding the shares of equity securities issuable upon the conversion of Notes. 4) Given the company's existing convertible notes total $42,500 (see company's balance sheet, case Exhibit 3c), the total amount of convertible notes will be $342,500 with the Founder.org offer or $142,500 with the Techstars offer. The company raises $3 million in a Series A round where the company has a post money valuation of $12 million. The Series A financing terms include a provision stating that post-Series A, the stock option pool will equal 15% of the company's fully diluted shares.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Managerial Finance

Authors: Lawrence J. Gitman, Chad J. Zutter

13th Edition

9780132738729, 136119468, 132738724, 978-0136119463

More Books

Students also viewed these Finance questions

Question

What is the major difference between a mold and a yeast?

Answered: 1 week ago