What is the company after-the-money valuation

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You have just discovered a groundbreaking drug. You have approached a venture capitalist, asking for a $60 million investment in your company. You believe that the initial $60 million investment to generate $25 million annual free cash flows indefinitely. The discount rate is 15%. If the venture capitalist agrees to give you the $60 million in exchange for a 40% ownership share in the company, what is the company's "after-the-money" valuation (defined as the valuation for the entire company that is implied by what the venture capitalist paid for the 40% ownership share)?

Reference no: EM132694632

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