Question $3$

$10$ Points

Valuation Part $2(10$ points$)$

EmergEx Medical is a start$-$up company that has developed a life$-$saving medical device that can be used in emergency rooms, on battle field clinics and in other trauma related facilities. The device is patent protected and the first version has received the required FDA testing and approval. The company hopes to get the product to market in the next $9$ months. The founders are a team comprised of an emergency room doctor who developed the concept, an engineer who developed the product, and a former VP of sales for another medical device company. None have startup experience. While the company does not yet have sales, they have had a lot of interest from hospital emergency room doctors. One medical equipment distribution company that sells medical devices to hospitals across the country has communicated an interest in distributing the product, but to date there are no signed distribution contracts.

Carefully look at the information $($or lack of information$)$ provided in the above scenario. Using the Berkus method, determine the value of each element in the model up to $$500k$ per element $($sound idea, prototype, quality management team, strategic relationships, product rollout or sales$).$ Explain why you estimated the value of each as you did.

$\backslash$table$[[$Element$,$Value,Why$],[$Sound Idea,,$],[$Prototype$,,],[$Quality Team,,$],[$Strategic relationships,,$],[$Rollout or sales,,$],[$Total Value,,$]]$