Connor McDavid is the greatest hockey player of all time….and because he is so awesome, the Oilers have paid him a lot of money.  Connor has been very smart in saving some of that money, knowing that he might not play hockey forever.  Connor has set aside $2,000,000 of cash in his bank account thinking he might be able to invest it to earn a few extra bucks.  He expects that he should be able to earn 30% (per annum) on his ideas. Connor is trying to decide what might be best for him to invest in.  He doesn’t know much about venture investing so he has decided to hire FNCE4415 students at NAIT to help him do the assessments.  The three opportunities he is considering are below: Opportunity Estimated Annual Revenue Multiple Anticipated time to Exit Hockey Pool Tracking App $10,000,000 3x 3 years McDavid’s Musical Toothbrushes $7,000,000 4x 6 years McDavid Hair Salon $5,000,000 5x 4 years If Connor wants to achieve his desired rate of return, how much equity should he take in McDavid’s Hair Salon, assuming that he only chooses to invest $1,000,000.

In relation to a venture capital (VC) fund, what is the primary difference between General Partners (GPs) and Limited Partners (LPs)?

Connor McDavid is the greatest hockey player of all time….and because he is so awesome, the Oilers have paid him a lot of money.  Connor has been very smart in saving some of that money, knowing that he might not play hockey forever.  Connor has set aside $2,000,000 of cash in his bank account thinking he might be able to invest it to earn a few extra bucks.  He expects that he should be able to earn 30% (per annum) on his ideas. Connor is trying to decide what might be best for him to invest in.  He doesn’t know much about venture investing so he has decided to hire FNCE4415 students at NAIT to help him do the assessments.  The three opportunities he is considering are below: Opportunity Estimated Annual Revenue Multiple Anticipated time to Exit Hockey Pool Tracking App $10,000,000 3x 3 years McDavid’s Musical Toothbrushes $7,000,000 4x 6 years McDavid Hair Salon $5,000,000 5x 4 years A. Using the comparable valuation method (revenue multiples), what is the forecasted exit value of Hockey Pool Tracking App? (Use commas to separate thousands, eg. 2,000,000).  _______ dollars

Getting funded is the ultimate goal. How you get the money does not matter. True or False?

Connor McDavid is the greatest hockey player of all time….and because he is so awesome, the Oilers have paid him a lot of money.  Connor has been very smart in saving some of that money, knowing that he might not play hockey forever.  Connor has set aside $2,000,000 of cash in his bank account thinking he might be able to invest it to earn a few extra bucks.  He expects that he should be able to earn 30% (per annum) on his ideas. Connor is trying to decide what might be best for him to invest in.  He doesn’t know much about venture investing so he has decided to hire FNCE4415 students at NAIT to help him do the assessments.  The three opportunities he is considering are below: Opportunity Estimated Annual Revenue Multiple Anticipated time to Exit Hockey Pool Tracking App $10,000,000 3x 3 years McDavid’s Musical Toothbrushes $7,000,000 4x 6 years McDavid Hair Salon $5,000,000 5x 4 years If Connor wants to achieve his desired rate of return, how much equity should he take in McDavid’s Musical Toothbrushes, assuming that he only chooses to invest $1,000,000.

Most BA investors want to control the business and will manage the entrepreneurs through deal terms and contractual arrangements. True or False?

Connor McDavid is the greatest hockey player of all time….and because he is so awesome, the Oilers have paid him a lot of money.  Connor has been very smart in saving some of that money, knowing that he might not play hockey forever.  Connor has set aside $2,000,000 of cash in his bank account thinking he might be able to invest it to earn a few extra bucks.  He expects that he should be able to earn 30% (per annum) on his ideas. Connor is trying to decide what might be best for him to invest in.  He doesn’t know much about venture investing so he has decided to hire FNCE4415 students at NAIT to help him do the assessments.  The three opportunities he is considering are below: Opportunity Estimated Annual Revenue Multiple Anticipated time to Exit Hockey Pool Tracking App $10,000,000 3x 3 years McDavid’s Musical Toothbrushes $7,000,000 4x 6 years McDavid Hair Salon $5,000,000 5x 4 years A. Using the comparable valuation method (revenue multiples), what is the forecasted exit value of McDavid Hair Salon? (Use commas to separate thousands, eg. 2,000,000).  _______ dollars

PE funds are typically used to reintroduce value into a mature business and generate profit from, rightsizing the investee business. What is not typically included in rightsizing?

Connor McDavid is the greatest hockey player of all time….and because he is so awesome, the Oilers have paid him a lot of money.  Connor has been very smart in saving some of that money, knowing that he might not play hockey forever.  Connor has set aside $2,000,000 of cash in his bank account thinking he might be able to invest it to earn a few extra bucks.  He expects that he should be able to earn 30% (per annum) on his ideas. Connor is trying to decide what might be best for him to invest in.  He doesn’t know much about venture investing so he has decided to hire FNCE4415 students at NAIT to help him do the assessments.  The three opportunities he is considering are below: Opportunity Estimated Annual Revenue Multiple Anticipated time to Exit Hockey Pool Tracking App $10,000,000 3x 3 years McDavid’s Musical Toothbrushes $7,000,000 4x 6 years McDavid Hair Salon $5,000,000 5x 4 years If Connor wants to achieve his desired rate of return, how much equity should he take in Hockey Pool Tracking App, assuming that he only chooses to invest $1,000,000.

Which element is consistently rated by BAs and VCs as one of the top criterion in the decision to invest? Select one: