Exit Strategies and Investor Returns Assessment
Module 5 • 10 Questions
Question 1 of 10
0 of 10 answered
A startup plans an IPO to raise capital at a post-money valuation of $200,000,000.00. The pre-IPO total outstanding shares are 8,000,000 shares. The IPO contains: (1) A Fresh Issue of 2,000,000 new shares to fund operations; (2) An Offer for Sale (OFS) of 1,000,000 existing shares by early VCs. What is the discovered per-share price of the IPO, the total capital raised for the company (via Fresh Issue), the total dollar liquidity realized by the VCs (via OFS), and the VCs' post-IPO ownership % (assuming they held 3,000,000 shares pre-IPO)?
A
Share Price: $20.00; Fresh Issue: $40,000,000.00; OFS liquidity: $20,000,000.00; VC post-IPO ownership: 20.0%
B
Share Price: $20.00; Fresh Issue: $50,000,000.00; OFS liquidity: $10,000,000.00; VC post-IPO ownership: 25.0%
C
Share Price: $25.00; Fresh Issue: $40,000,000.00; OFS liquidity: $20,000,000.00; VC post-IPO ownership: 20.0%
D
Share Price: $20.00; Fresh Issue: $40,000,000.00; OFS liquidity: $20,000,000.00; VC post-IPO ownership: 15.0%