Question

Simone founded her company using $200,000 of her own money, issuing herself 200,000 shares of stock. An angel investor bought an additional 100,000 shares for $150,000. She now sells another 500,000 shares of stock to a venture capitalist for $1.5 million. What is the post-money valuation of the company

Answer 1

2,400,000

Explanation:

The computation of post-money valuation of the company is shown below:-

post-money valuation of the company is

= Total shares outstanding × Price per share

= (200,000 + 100,000 + 500,000) × (1,500,000 ÷ 500,000)

= 800,000 × 3

= 2,400,000

Therefore we have applied the above formula by considering all the elements given in the question