Corporate finance Equity Shares Issued (in practice)
So my company is raising capital. We are dealing with investors and have agreed upon a $5 million pre-money valuation. Based on the number of shares outstanding, the current share price works out to $0.3931 or a more precise calculation is $0.39306229
A new investor is coming in and wants to give the company $200,000, how many shares will they get? In excel the calculation says 508,825 but on the term sheet the amount is a bit less (508,776) based on $0.3931.
How many shares should the investor be getting? If we change the share price and round then the company value is slightly more than $5 million. How does this get reconciled in practice? (The company is private obviously)
Est sit sint dolorum dolorem debitis quasi. Fugiat dolor sit et.
Nisi et dicta molestiae quia ipsa blanditiis. Non quasi et quis repellat dignissimos aliquam praesentium sunt. Quas commodi voluptatem voluptates nihil. Ipsam ut atque maxime fuga quo magnam reiciendis.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...