Venture Capital Method (w/ Multiple Financing Rounds)

1. Exit Value*

2. Number of existing shares (founders)*

3. Investment amount

Round 1

Round 2

Time of Exit

4. Disc Rate(%)

Year 1*

Year 2*

Year 3*

Year 4*

OUTPUT SECTION

5. (1+r)

Year 1

Year 2

Year 3

Year 4

6 Valuation at exit

Round 1

Round 2

Time of Exit

7. Compound discount rate

Round 1

Round 2

Time of Exit

8. Number of existing shares

Round 1

Round 2

Time of Exit

9. Post-Money

Round 1

Round 2

Time of Exit

10. Pre-Money

Round 1

Round 2

Time of Exit

11. Ownership fraction of investors

Round 1

Round 2

Time of Exit

12. Ownership fraction of previous round

Round 1

Round 2

Time of Exit

13. Number of new shares

Round 1

Round 2

Time of Exit

14. Total shares issued

Round 1

Round 2

Time of Exit

15. Price per share

Round 1

Round 2

Time of Exit

Entrepreneurs:

16. Ownership shares

Round 1

Round 2

Time of Exit

17. Ownership percentage

Round 1

Round 2

Time of Exit

18. Wealth

Round 1

Round 2

Time of Exit

First Round:

19. Ownership shares

Round 1

Round 2

Time of Exit

20. Ownership percentage

Round 1

Round 2

Time of Exit

21. Wealth

Round 1

Round 2

Time of Exit

Second Round:

22. Ownership shares

Round 1

Round 2

Time of Exit

23. Ownership percentage

Round 1

Round 2

Time of Exit

24. Wealth

Round 1

Round 2

Time of Exit

Notes:
1. Terminal Value (at time of exit)
2. Number of existing shares (owned by the entrepreneurs)
3. Valuation of company at the time of event (financing or exit)
4. The compound discount rate (1+R) is the product of the discount rates (1+r) between the time of two valuation events
5. Amount of investment per round
6. Number of existing shares (prior to financing event)
7. Post-Money Valuation: POST = V/(1+R)
8. Pre-Money Valuation: PRE = POST - I
9. Required ownership fraction for the investor: F = I / POST
10. Number of shares the investors require to achieve their desired ownership fraction: y = x[F/(1-F)]
11. Price per share: p = I / y
12. Discount rates per year. For calculating the compound discount rate (1+R).
13. Use the product of the discount rates (1+r) to calculate the compound discount rates (1+R) used in [4].