User Account

All Pages

What is the present value of your NYDeli venture

Assignment Help Finance Basics
Reference no: EM132906643

Problem - Venture Capital Valuation Method - A venture capitalist firm wants to invest $1.5 million in your NYDeli Internet venture that you started six months ago. You do not expect to make a profit until Year 4 when your net income is expected to be $3,000,000. The common stock of BioSystems, a comparable firm, currently trades in the over-the-counter market at $30 per share. BioSystems' net income for the most recent year was $300,000 and the firm has 150,000 shares of common stock outstanding.

A. Apply the VC method to determine the value of the NYDeli at the end of four years.

B. If venture capitalists want a 40 percent compound annual rate of return on similar investments, what is the present value of your NYDeli venture?

C. What percentage of ownership of the NYDeli dot-com venture will you have to give up to the VC firm for its $1.5 million investment?

Reference no: EM132906643

Questions Cloud

Calculate the revised cash generated from operations figure : Calculate the revised cash generated from operations figure. Provide the journal entries that will be required to correct the errors, including a brief journal.
Responsibilities of a measurement instrument : "What are college student attitudes toward dining in restaurants during the COVID-19 pandemic?"
Describe the different options for accelerating project : Describe the different options for accelerating project completion if Resources are not constrained and if Resources are constrained
What is the company annual interest tax shield now : What is the company's annual interest tax shield now? 10 years later, interest rates have dropped so that the yield on Camden's bond is currently 4%.
What is the present value of your NYDeli venture : If venture capitalists want a 40 percent compound annual rate of return on similar investments, what is the present value of your NYDeli venture
What was real income in terms of constant : What was her real income in 2017 in terms of constant 1950 dollars? An engineer in 1950 was earning $6,300 a year. In 2017 she earned $83,000 a year.
How does a documentary letter of credit work as a credit : How does a Documentary Letter of Credit (DLC) work as a credit enhancement device for importers and a credit risk mitigating tool for exporters?
What are the related pre-money and post-money valuations : The existing number of shares outstanding is 200,000. What are the related pre-money and post-money valuations
Addressing poverty in america : 1. As a means of addressing poverty in America, the 20th century focused upon improvingequality of opportunity. Yet, despite remarkable advances, poverty remain

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd