Venture Capital Exit Distribution Simulator

A flexible simulator for Exit distributions under different financing scenarios.

by Ben Scherer
Venture Capital, Investment and Start-Up ProfessionalFollow

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Description
This model shall help evaluate different investment strategies and their impact on the final exit proceeds to different stakeholders
- Can cover 3-4 cases
- Models Full Ratchet Anti Dilution in Exit
- Models Liquidation Preferences and Participating Preferred Structure
- Easily turn on / off financing rounds with simple switch
- Return calculation per Share Class. Investors need to analyse their allocation for each share class to calculate returns
- Does not model other dilutive instruments (convertibles, options, etc.)

The model can be used to configure 3 operating cases for a company and look at distributions under different Exit Valuations.
By assigning probabilities to cases, implied financing scenarios and probabilities of return distributions, this can be used
as an entry point for a Option Tree-based valuation (Input to PWERM or OPM)

The model contains comments.
How to use:
1. Go through the scenarios or play around on the playground scenario.
2. You can enter business case assumptions on burnrate to sanitize assumptions on the fundraising funnel for the venture
3. You can set key terms of the financing from valuation, liquidation preference and preferred structure.
4. You can go through the waterfall caculations - which include comments - and understand the output.

For any questions, there is contact information in the model or send a Private Message here: https://www.eloquens.com/channel/ben-scherer We also do detailed analysis if requested.

This Best Practice includes
1 Excel Model