If a venture issues debt prior to the exit period, the initial equity investors will still receive first claims on the venture's net worth at exit time.

Name: If a venture issues debt prior to the exit period, the initial equity investors will still receive first claims on the venture's net worth at exit time.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Debt holders have priority over equity investors in claims on a venture's assets and net worth at exit time, meaning they are paid before equity investors.

If a Venture Issues Debt Prior to the Exit Period