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You have purchased 1 million shares in a restaurant chain venture. At this zero-stage investment, your company's assets are $100,000 plus the idea for your
You have purchased 1 million shares in a restaurant chain venture. At this zero-stage investment, your company's assets are $100,000 plus the idea for your new product. Suppose that when you first approach your friendly VC, he decides that your shares are worth only $0.40 each. a. How many shares will you need to sell to raise the additional $500,000? (Enter your answer in whole numbers, not in millions.) Shares 1,250,000 b. What fraction of the firm will you own after the VC investment? (Enter your answer as a percent rounded to 1 decimal place.) Percentage of shares owned 0.7 %
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