You Founded Your Own Firm Three Years Ago

question 103

Multiple Choice

You founded your own firm three years ago. You initially contributed $200,000 of your own money and in return you received 2 million shares of stock. Since then, you have sold an additional 1 million shares of stock to angel investors. You are now considering raising capital from a venture capital firm. This venture capital firm would invest $4 million and would receive 2 million newly issued shares in return. The post-money valuation of your firm is closest to ________.

• A) $10.0 million
• B) $4.0 million
• C) $9.0 million
• D) $3.5 million

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Definitions:

Books in Bookcase

Items, typically bound and containing written or printed material, organized and stored on shelves in a piece of furniture known as a bookcase.

Behavior Modification

A method of therapy rooted in operant conditioning principles, which aims to substitute negative behaviors with positive ones using either rewards or penalties.

Classical Conditioning

The procedure of learning through continual pairing of two stimuli; a behavior that initially results from the second stimulus later results from only the first stimulus.

Instinctive Drift

The inclination of an animal to return to innate behaviors that disrupt a learned reaction.