Your start-up company needs capital. Right now, you own 100% of the firm with 10.2 million shares.
Question:
Your start-up company needs capital. Right now, you own 100% of the firm with 10.2 million shares. You have received two offers from venture capitalists. The first offers to invest $2.95 million for 1.04 million new shares. The second offers $2.01 million for 542,000 new shares.
a. What is the first offer’s post-money valuation of the firm?
b. What is the second offer’s post-money valuation of the firm?
c. What is the difference in the percentage dilution caused by each offer?
d. What is the dilution per dollar invested for each offer?
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a First offer Postmoney valuation Premoney valuation Investment Premoney valuation 102 million 100 o...View the full answer
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Related Book For 
Fundamentals Of Corporate Finance
ISBN: 9781292437156
5th Global Edition
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
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