Question: An entrepreneur seeks 4 million from a venture capitalist They
An entrepreneur seeks $4 million from a venture capitalist. They agree that the entrepreneur’s venture is currently worth $12 million and that, when the company goes public in an IPO three years hence, it will have an expected market capitalization of $70 million. Given the company’s stage of development, the VC requires a 40% return on investment. What fraction of the firm will the VC receive in exchange for its $4 million investment?
Answer to relevant QuestionsAn entrepreneur seeks $10 million from a VC fund. The entrepreneur and fund managers agree that the entrepreneur’s venture is currently worth $25 million and that the company is likely to be ready to go public in five ...What is meant by a change in corporate control? List and describe the various ways in which a change of corporate control may occur. Define the types of synergy that may result from mergers. What are the sources of these synergies? How have individual states become more active monitors of takeover activity? You are the director of capital acquisitions for Morningside Hotel Company. One of the projects you are deliberating is the acquisition of Monroe Hospitality, a company that owns and operates a chain of bed-and-breakfast ...
Post your question