ACME Software Company has CURRENT (i.e. today; year "zero") market value of its venture's assets of $250K (effectively its current equity valuation cash flow). Forecasted cash-flows for next 5 years is as follows: Year 1: ($350,000), i.e. negative Year 2: ($100,000) Year 3: $250,000, i.e. positive Year 4: $450,000 Year 5: $500,000 Year 6+: Assume $600K in year 6, growing at 6% annually thereafter Years 1-5 discount rate of 40% Years 6+ assume 15% given company should be more mature, less risky, and more predictable. Given the same information as the previous question, how much %ownership (rounded) would a $250,000 investment fetch assuming the NPV of the ACME Software (the pre-money valuation) you just calculated?
ACME Software Company has CURRENT (i.e. today; year "zero") market value of its venture's assets of $250K (effectively its current equity valuation cash flow).
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