If you are looking at a distribution waterfall for a private equity or venture capital fund, there are a few key things to understand. First, the waterfall typically starts with a return of capital to the limited partners (LPs) or investors. This is the money that they originally invested, plus any accumulated profits. Once the … Read more
Pre-money valuation refers to the value of a company before an investment is made. This is the value of the company that an investor uses to determine how much equity to purchase in the company. The pre-money valuation is calculated by subtracting the amount of the investment from the post-money valuation. Does pre-money valuation include … Read more
A traunch is a term used in private equity and venture capital to describe a portion or tranche of a larger investment. A traunch typically refers to a slice of a larger investment that is made over time, with each tranche having its own terms and conditions. For example, a venture capital firm may invest … Read more
