Comment on The IPO Markets - Part 1

KASHYAP commented on 04 Oct 2016, 11:26 AM

Question from newbie…
1. Who does decide how much % of stake for what amount? And how is it decided?
If VS agrees to give 7Cr for 7% stake in the company. In that case, valuation of the company would be 100Cr. which means company valuation is doubled for the same amount of investment.
Is there any formula / rule / regulation to decide this funding-stake relation?
2. What is meant by valuation? Can this valuation be converted to actual money, if let’s say company is sold out?

View the full comment thread »