A Venture Investment Round That Is Priced at More Than

question 36

True/False

A venture investment round that is priced at more than the previous round is referred to as cram-down round.

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Definitions:

After-Tax Cash Inflows

After-tax cash inflows represent the net cash a company receives from its operations, investments, or financial activities, after all taxes have been deducted.

Flotation Cost

The total costs a company incurs when it issues new securities, including underwriting fees, legal fees, and registration fees.

Debt-Equity Ratio

Debt-equity ratio is a financial ratio indicating the relative proportion of shareholders’ equity and debt used to finance a company’s assets.

External Financing

This refers to funds raised from outside the company, including loans, credit, or investments from external entities, to support the company's activities.