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Two entrepreneurs launch their startup with 20,000 euros each, and they constitute their company with 1/sh share nominal value. Over time, they complete the following
Two entrepreneurs launch their startup with 20,000 euros each, and they constitute their company with 1/sh share nominal value. Over time, they complete the following rounds of investment:
- 6 months after the foundation, they get 50,000 from an accelerator program for 9% of the company.
- 1 year later they raise 400,000 from a business angels syndicate for 25% of the company.
Answer the following questions, showing your work:
- What was the implied valuation of the company for the accelerator?
- How many shares did the accelerator receive when they first invested?
- How many shares did the accelerator receive when the syndicate came in?
- What price did the accelerator pay for their shares?
- What is the pre-money valuation of the company at the syndicates round?
- What premium per share did the syndicate pay?
- How many shares are owned by the founders at the end of the process?
- How much is the value of the total common stock at the end of the process?
- By how much did the accelerator multiply the value of their shares when the syndicate came in?
- If a 10% of the equity has to be reserved as an option pool when the accelerator comes in, by how much will the accelerator be diluted on that round?
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