You have started a company and are in lucka venture capitalist has offered to invest. You own

Question:

You have started a company and are in luck—a venture capitalist has offered to invest.

You own 100% of the company with 5.28 million shares. The VC offers $1.02 million for 760,000 new shares.

a. What is the implied price per share?

b. What is the post-money valuation?

c. What fraction of the firm will you own after the investment?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Fundamentals Of Corporate Finance

ISBN: 9781292437156

5th Global Edition

Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford

See More Books

Question Posted: Feb 21, 2024 10:00 AM

See More Questions

Last Sale Net Bid Ask Open Int Puts Last Sale Net bid Ask Vol Open Int 16Aug 155.00(1619H155-E) 6.45 0.75 6.95 7.25 9 16Aug 155.00(1619T155-E) 1.18 (0.75) 1.17 1.25 61 4505 16Aug 166.00(1619H160-E)...
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
Sound waves with frequency 3000 Hz and speed 343 m/s diffract through the rectangular opening of a speaker cabinet and into a large auditorium of length d = 100 m. The opening, which has a horizontal...
A piecewise-defined function will always have at least one x-intercept or at least one y-intercept. Determine whether the statement is true or false. Justify your answer?
1. Why was PayPal successful while other online payment services failed? 2. Why are positive network effects so crucial to the success of platform strategy? 3. Why is it so difficult to initiate...
Assume that the current measurements in a strip of wire follow a normal distribution with a mean of 10 milliamperes and a variance of 4 (milliamperes) ${ }^{2}$. What is the probability that a...
Non-financial measures of quality and time. Worldwide Cell Phones (WCP) has developed a cell phone that can be used anywhere in the world (even countries like Japan that have a relatively unique cell...
Consider the three stocks in the following table. Pi represents a price per share at time t (year), and Qi represents shares outstanding (numbers) at time t. Stocks Po Qo P Q1 P2 Q2 A 110 200m 120...
Starware Software was founded last year to develop software for gaming applications. The founder initially invested $1,000,000 and received 12 million shares of stock. Starware now needs to raise a...
You are the CFO of a company that has a market capitalization of $1 billion. The firm has 100 million shares outstanding, so the shares are trading at $10 per share. You need to raise $200 million...
Factor each polynomial. If a polynomial cannot be factored, write prime. Factor out the greatest common factor as necessary. y 2 4yz 21z 2
What is organizational Behaviour the study of? How is social sciences related to organizational behavior? What is the difference between social science and organizational behavior? What is the...
How do leaders cultivate resilience and emotional intelligence within their teams, equipping individuals with the psychological tools necessary to navigate ambiguity and embrace change as a catalyst...
Consider a Venn diagram, where P(E) = .10, P(E2) = .05, P(E3) = P(E4) = .2, P(Es) = .06, P(E) .3, P(E7) = .06, and P(Eg) = .03. E1 E3 A E7 E E4 Es B Find the following probabilities: a) P(A) b) P(B)...
How do change leaders effectively manage complexity and navigate the interplay of interconnected systems and subsystems within organizations to orchestrate holistic and enduring transformational...
Use supply & demand curves to explain what might happen in the market for bicycles if the price of gasoline increases. ps. (not gas powered bike)( make supply and demand curve to show what happens to...
If you chose to use only long-term financing, what total amount of borrowing would you need to have on a permanent basis? Forecast your excess cash levels under this scenario (see MyFinanceLab for...
Element compound homogeneous mixture (heterogeneous mixture) 4) A piece of gold has a mass of 49.75 g. What should the volume be if it is pure gold? Gold has a density of 19.3 g/cm (3 points) D=m/v...
Du Pont Identity Why is the Du Pont identity a valuable tool for analyzing the performance of a firm discuss the types of information ii reveals compared to ROE considered by itself.
Industry-Specific Ratios Specialized ratios are sometimes used in specific industries, For example, the so-called book-to-bill ratio is closely watched for semiconductor manufacturers. A ratio of .93...
Industry-Specific Ratios So-called same-store sales are a. very important measure for companies as diverse as McDonalds and Sears. As the name suggests, examining same-store sales means comparing...
ABC Inc. uses normal costing for its job costing system, which has two direct-cost categories (direct materials and direct manufacturing labor) and one indirect-cost category (manufacturing...
es Gold Nest Company of Guandong, China, makes birdcages for the South China market. The company sells its birdcages through an extensive network of street vendors who receive commissions on their...
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were as follows: Raw materials $ 84,500 Work in process Finished goods $ 35,000 $...

You have started a company and are in lucka venture capitalist has offered to invest. You own

Question:

Step by Step Answer:

a Implied price per share Investment amount Number of new shares 102 million 760000 shares 134 p...View the full answer

Fundamentals Of Corporate Finance

Students also viewed these Business questions