Horizon

A Comprehensive Analysis of a VC Deal

Horizon Communications

Template

Evaluation of Company projections FCF Income Stat. Balance Sheet Cash Flow

APV (Ceiling valuation)

Prob. Adj. APV. VC NPV. Comps

Capitalization Table (Financing Plan) Term Sheet Table of Returns

Appropriate Discount Rate

Early Stage: 50%

Growth Equity: 40% Near Liquidity: 30%

Venture Capital Matrix Common Stock Equivalent (Assume Theoretical Ownership)

Entrepreneur Money

Negotiated Deal

Market Condition (e.g. Multiple of EBITDA)

IRR / Cash on Cash

Market Condition (e.g. Multiple of EBITDA)

IRR / Cash on Cash

Performance (% of EBITDA)

Performance (% of EBITDA)

Theoretical Valuation

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Negotiated Deal

Clinical Prof. Scott Meadow Entrepreneurial Finance and Private Equity

Horizon Communications:

OUTSIDE - IMPACTS Analysis

Introduction

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The OUTSIDE - IMPACTS template provides a framework to evaluate a potential investment …

• Capture key points and critical figures to assess probability of success:

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Industry size and dynamics Management centrality, experience, and capability Reference accounts

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Pipeline of potential accounts

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Template is only a guide ... use your own insight and business judgment

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Clinical Prof. Scott Meadow Entrepreneurial Finance and Private Equity

Summary of Business

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Company Name: Description of Idea:

Horizon Communications Corporation CLEC providing a suite of telecom services to high-margin customers (large businesses); It will lease access on existing lines and invest in a state of the art switching platform. Seed/Early Stage To become a CLEC without installation of proprietary lines, but rather leasing capacity from multiple vendors. Target customers will be large business which constitute 30% of line usage and 50% of market revenue.

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Stage/Opportunity: Business Description:

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Clinical Prof. Scott Meadow Entrepreneurial Finance and...