Question: Finance problem Could you solve these problems? this is Entrepreneurial finance. 1 CHAPTER 11 VENTURE CAPITAL VALUATION METHODS HOMEWORKYOU MUST SHOW YOUR WORK! Post to

Finance problem
Could you solve these problems? this is Entrepreneurial finance.

1 CHAPTER 11 VENTURE CAPITAL VALUATION METHODS HOMEWORKYOU MUST SHOW YOUR WORK! Post to Canvas by deadline. Use the following information for Problems 1 through 6. A potential Venture Capital investor is negotiating a $75,000 investment in an Analytics venture, and is targeting a 50% compounded return over their anticipated holding period of 7 years. The venture is expected to produce $250,000 in income per year by the end of year 7. Currently, the Analytics Venture has 500 shares of stock outstanding that is held by its founder. It is known that similar risky ventures have recently produced $1,000,000 in income in the year of exit, and were valued at $7,500,000. 1. What is the percent ownership of the exit value of the venture that the Investor should negotiate today, in order to provide them with their anticipated target return? 2. What is the number of shares that must be issued to the new investor in order for the investor to earn their target return? 3. What is the issue price per share? 4. What is the pre-money valuation? 5. What is the post-money valuation? 6. What is the value of the venture in year 7 using direct capitalization? Fn: VC Valu HW.docx
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