Your start-up company needs capital. Right now, you own 100% of the firm with 10 million shares.
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Your start-up company needs capital. Right now, you own 100% of the firm with 10 million shares. You have received two offers from venture capitalists. The first offers to invest $3 million for 1 million new shares. The second offers $2 million for 500,000 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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Plan Postmoney valuation is implied price per share total shares new and old For a and b you must ca...View the full answer
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