chaper 11

Question 1

annualized return

Answer 1

r = (FV/PV)¹/i - 1

Question 2

founder ownership percentage

Answer 2

1. FV = PV (1 + r)^t
2. % of total FV = FV value/ total FV of company exit
3. founder final ownership (%) = 1 - (first round % + sec round % + …)

Question 3

how many shares will be issued

Answer 3

1. total shares at year # = total shares/founder final ownership
2. round 1/2/3 shares = % of total FV x total shares at year #

Question 4

round # prices

Answer 4

PV/round 1/2/3 shares

Question 5

shares will be issued

Answer 5

1. founder value + x
2. x = (% of each round/100-% round) x 100
3. total shares = founder value + X

Question 6

share price

Answer 6

investment amount / shares issued