![]() ![]() ![]() The VC also considers a range of possible exit-year EBITDA multiples based on comparable companies, but discounted to reflect the illiquidity of the VC’s investment. 75% and 50%) to yield a range of possible EBITDA performance. 100% EBITDA performance), then multiplies this EBITDA value by other percentages (e.g. ![]() The VC typically takes the exit-year EBITDA projected by the entrepreneur and assumes this to be the best-case operating scenario (i.e. A commonly used metric to measure operating performance and compute the exit valuation is EBITDA. Rather than compute single IRR and CoC figures for a given investment opportunity, VCs compute a range of such figures that consider varying degrees of operating success and different exit multiples. CoC is simply equal to how much the VC receives in proceeds upon exiting the investment divided by how much it initially invests in the company and, unlike IRR, is not dependent on when the exit actually occurs. ![]()
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