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  3. in 2017, mkt ventures invests $100,000 in spc with

In 2017, MKT ventures invests $100,000 in SPC with the post-money valuation of $2 per...

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Accounting

In 2017, MKT ventures invests $100,000 in SPC with the post-money valuation of $2 per share. In 2017, SPC is preparing IPO in 3 years. Expected earnings in 2019 is $20 million. PER of benchmark companies at the time of IPO is expected to be 35.

Additional expectation for the IPO is as follows:

The number of existing shares = 1 million shares

Employee stock options: 200,000 shares

New issue = 20% of existing shares

IPO discount = 30%

Given that MKT ventures will sell entire shares at the IPO price, what is the expected IRR and TVPI?

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