A founder owns 100% of their startup. They are offered an equity investment by a VC investor,
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A founder owns 100% of their startup. They are offered an equity investment by a VC investor, accepts, and eventually, undergoes one more round of financing, with a new VC investor. The financing events are as follows: VC investor 1 steps in with $0.5 million at a pre-money value of $2 million; later, VC investor 2 contributes $3 million at a pre-money of $7 million; After the second round of investment, what is the worth in stock of the founder, of VC1, and of VC2? What percentage of the company does each own?
Related Book For
Entrepreneurial Finance
ISBN: 978-1305968356
6th edition
Authors: J. Chris Leach, Ronald W. Melicher
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