Use the following given information by Greyhorse Partners to answer the following question.

• Greyhorse is willing to provide $1.2 million in funding in exchange for a share of the common stock in a firm called Bull-Builders.
• As this is the first-stage financing, Greyhorse’s required rate of return is 50% per year based on a 5-year investment horizon without receiving any cash until the end of this period.
• The forecast of EBITDA for Bull-Builders in year 5 is $6m.
• The EBITDA multiple of similar firms is 7 times.
• Bull-Builders’ projected balance sheet at year 5 includes $100,000 in cash and $1m in interest-bearing debt.

What is the post-money value of the firms’ equity today?

Answer rating: 100% (QA)

To calculate the postmoney value of the firms equity we need to determine the premoney value of the ... View the full answer