You are an early-stage VC conducting due diligence on an IT start-up. You are willing to cotribute $1,548,000 in the A round of financing and require a capital return (i.e., capital multiplier) of 12. You anticipate B and C rounds of financing in years 3 and 6 that will dilute your position by 30% and 40%, respectively, because your firm will not participate in either additional round. You estimate firm value at $120,000,000 in nine years. Required:

What is the expected IRR of the investment?

Suppose you stage the distribution of the capital into $548,000 installments disbursed immediately, at the end of the first year, and at the end of the second year. What is the IRR of the investment in this scenario?