Questions from Corporate Finance

Q: You have an arrangement with your broker to request 1000 shares of

You have an arrangement with your broker to request 1000 shares of all available IPOs. Suppose that 10% of the time, the IPO is “very successful” and appreciates by 100% on the first day, 80% of the t...

Q: What are the advantages to a company of selling stock in an

What are the advantages to a company of selling stock in an SEO using a cash offer? What are the advantages of a rights offer?

Q: What are the advantages and the disadvantages to a private company of

What are the advantages and the disadvantages to a private company of raising money from a corporate investor?

Q: In early-2015, Abercrombie & Fitch (ANF) had

In early-2015, Abercrombie & Fitch (ANF) had a book equity of $1390 million, a price per share of $25.52, and 69.35 million shares outstanding. At the same time, The Gap (GPS) had a book equity of $29...

Q: Suppose venture capital firm GSB partners raised $100 million of committed

Suppose venture capital firm GSB partners raised $100 million of committed capital. Each year over the 10-year life of the fund, 2% of this committed capital will be used to pay GSB’s management fee....

Q: Your robotic automation start-up, Kela Controls, has raised

Your robotic automation start-up, Kela Controls, has raised capital as follows: a. How much did Kela raise in each round? b. Assuming no other securities were issued, what fraction of the firmâ...

Q: Beru.com recently raised $5 million with a pre-

Beru.com recently raised $5 million with a pre-money value of $9 million. They are seeking to raise another $6 million. What is the largest fraction of the firm they can offer and avoid a down round?...

Q: Bit Box has raised $10 million in a Series A round

Bit Box has raised $10 million in a Series A round with $40 million post-money value and a 1.5x liquidation preference, and $25 million in a Series B round with a $75 million post-money value and a 3x...

Q: What are the main advantages and disadvantages of going public?

What are the main advantages and disadvantages of going public?

Q: Explain some of the differences between a public debt offering and a

Explain some of the differences between a public debt offering and a private debt offering.