Why Choose Us?
0% AI Guarantee
Human-written only.
24/7 Support
Anytime, anywhere.
Plagiarism Free
100% Original.
Expert Tutors
Masters & PhDs.
100% Confidential
Your privacy matters.
On-Time Delivery
Never miss a deadline.
Three years? ago, you founded your own company
Three years? ago, you founded your own company. You invested $110,000 of your own money and received 5.5 million shares of Series A preferred stock. Your company has since been through three additional rounds of financing.
Round
Price
Number of Shares
Series B
?$0.60
1,050,000
Series C
2.00
550,000
Series D
6.00
550,000
a) What is the? pre-money valuation for the Series D funding? round?
b) What is the? post-money valuation for the Series D funding? round?
c) Assuming that you own only the Series A preferred stock? (and that each share of all series of preferred stock is convertible into one share of common? stock), what percentage of the firm do you own after the last funding? round?
Expert Solution
a) Computation of the pre-money valuation:-
Before Series D funding number of shares outstanding = 5,500,000 + 1,050,000 + 550,000
= 7,100,000
Pre money Valuation = 7,100,000 * $6
= $42,600,000
b) Computation of the post money valuation:-
Total number of shares = 5,500,000 + 1,050,000 + 550,000 + 550,000
= 7,650,000
Post money valuation = 7,650,000 * $6
= $45,900,000
c) Computation of the percentage of ownership:-
% of ownership = Share owned / Total share outstanding
= 5,500,000 / 7,650,000
= 71.90%
Archived Solution
You have full access to this solution. To save a copy with all formatting and attachments, use the button below.
For ready-to-submit work, please order a fresh solution below.
