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Suppose that it is one year after EBVs investment in Newco, and Tall-tree makes a Series B investment for 6M

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Suppose that it is one year after EBV’s investment in Newco, and Tall-tree makes a Series B investment for 6M shares of Newco at $0.2 per share. Following the Series B investment, what percentage of Newco (fully diluted) would be controlled by EBV? Consider the following cases:

Case I: Series A has no antidilution protection.

Case II: Series A has full-ratchet antidilution protection.

Case III: Series A has broad-base weighted-average antidilution protection.

Case IV: Series A has narrow-base weighted-average antidilution protection.


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Series A Series B Amount Invested 6 000 000 1 200 000 PPS 1 00 0 20 Number Shares 6 000 000 6 000 00…View the full answer


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Venture capital and the finance of innovation

Venture capital and the finance of innovation

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2nd Edition

Authors: Andrew Metrick

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Question Posted: June 23, 2012 05:12:13
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