Suppose that ROSS is considering a $10M Series A investment in MIC. ROSS proposes to structure the
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Suppose that ROSS is considering a $10M Series A investment in MIC. ROSS proposes to structure the investment as 3M shares of convertible preferred stock (CP). The employees of ROSS have claims on 10M shares of common stock. Following the Series A investment, MIC will have 10M common shares outstanding and would have 7M shares outstanding on conversion of CP. The fees are $20M. Investment Capital is $80M.
1. Compute the LP cost for this investment
2. Solve for the LP valuation equation for this investment
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Related Book For
Venture capital and the finance of innovation
ISBN: 978-0470454701
2nd Edition
Authors: Andrew Metrick
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