A VC is drafting a term sheet for a potential investment in a venture. The estimated discounted

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A VC is drafting a term sheet for a potential investment in a venture. The estimated discounted terminal value of the venture is $25 million. The venture has 1 million shares outstanding currently. The VC plans to invest is $5 million.

How many new shares of convertible preferred stock should be issued in order achieve the VC's required rate of return?

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Foundations Of Financial Management

ISBN: 9781259265921

11th Canadian Edition

Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta

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Posted Date: Jul 04, 2023 08:51 AM

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A VC is drafting a term sheet for a potential investment in a venture. The estimated discounted

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Lets assume that the price per share of the convertible preferred stock is 10 and the VCs required r... View the full answer

Foundations Of Financial Management

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