Template for Venture Capital Valuation Model

							Company Name Valuation -- Venture Capital Method

Assumptions Month of IPO Forecast annualized earnings at IPO P/E ratio at IPO Investment Round Month of Investment Investor required IRR Amount of Investment Required Monthly IRR Duration of Investment 48 $ 5,927,400.00 10 First Second Third 12 0 0 25% 20% 15% $ 2,000,000.00 $ 1,000,000.00 $ 1,000,000.00 2.08% 1.67% 1.25% 36 48 48

Ref A B C

C D E F G

Calculations Market Capitalization at IPO 59274000 H

Firm Value at Time of Investment Required FV for Investor at IPO Individual Investor's Share Individual Investor's ROI Individual Investor's IRR Investors' Share Founders' Share Negotiations

First Second Third $ 30,348,288.00 $ 28,585,069.44 $ 33,890,101.88 $ 3,906,250.00 $ 2,073,600.00 $ 1,749,006.25 I 6.59% 3.50% 2.95% J 1.953125 2.0736 1.74900625 K 0.25 0.2 0.15 L 13% 87% M N

First Individual Investor's Share FV for Investor at IPO Individual Investor's ROI Individual Investor's IRR Investors' Share Founders' Share 33% 19,560,420.00 978% 114% 33% 67%

Second 0 0 0 -1

Third 0 0 0 -1

Calculation

D/12 A-C

B*C

H/(1+F)^G E*(1+F)^G I/H I/E (I/E)^(12/G)-1 sum(J) 1-M

Company Name Valuation -- Venture Capital Method Years 1 to 5 Assumptions: Investor required IRR P/E ratio at IPO or acquisition Initial investment

1A 15 B 1000000 C D Year 1 2 3 4 5 E F Net Income MarketCapitalization income stmt B*E $ 211,000.00 $ 3,165,000.00 $ 400,000.00 $ 6,000,000.00 $ 800,000.00 $ 12,000,000.00 $ 1,200,000.00 $ 18,000,000.00 $ 3,500,000.00 $ 52,500,000.00

Venture Capital Method IPO in Year 1 IPO in Year 2 IPO in Year 3 IPO in Year 4 IPO in Year 5

G H Required Future Value (Investor) Investor'sShare FV(F,D) C/G $ 2,000,000.00 $ 4,000,000.00 $ 8,000,000.00 $ 16,000,000.00 $ 32,000,000.00

63% 67% 67% 89% 61%

I J Investor'sReturn Investor'sROI F*H I/C $ 2,000,000.00 200% $ 4,000,000.00 400% $ 8,000,000.00 800% $ 16,000,000.00 1600% $ 32,000,000.00 3200%

Year 1 2 3 4 5

Negotiation Worksheet Investor'sShare 25% 25% 25% 25% 25%

Investor'sReturn Investor'sROI $ 791,250.00 79% $ 1,500,000.00 150% $ 3,000,000.00 300% $ 4,500,000.00 450% $ 13,125,000.00 1313%

K Investor'sIRR IRR(I,C,D) #NUM! #NUM! #NUM! #NUM! #NUM!

Investor'sIRR #NUM! #NUM! #NUM! #NUM! #NUM!