Melissa founded her company using $100,000 of her own money,issuing herself 50,000 shares of stock.An angel investor bought an additional 30,000 shares for $75,000.She now sells another 30,000 shares to a venture capitalist for $450,000.What is the post-money valuation for the company?

Question

Quizplus · Accepted Answer

The pre-money valuation can be calculated by adding the amount of money Melissa invested to the amount the angel investor invested:

$100,000 + $75,000 = $175,000

The total number of shares before the venture capitalist's investment is:

50,000 + 30,000 = 80,000

The price per share for the venture capitalist's investment is:

$450,000 / 30,000 shares = $15 per share

The post-money valuation is calculated by multiplying the price per share by the total number of shares after the venture capitalist's investment:

$15 per share x (80,000 + 30,000) = $1.65 million

Therefore, the post-money valuation for the company is $1.65 million.

Melissa Founded Her Company Using $100,000 of Her Own Money,issuing