How much money investors makes while selling your company



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Assume an investor who invested $100 million holds 15% in your company and has a 2x liquidation preference. If you sell your company for $2 billion how much will this investor get?According to your tips the answer should be 200,Incorrect is showing Kindly Clarify

2 Answer(s)


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Company is sold for $2 billion.
Investor invested $100mn
Due to 2x liq.pref, investor will first get $200mn ($100mn x 2)
Remaining amount left is $1.8 billion
Then investor will get 15% of $1.8bn which is $270mn
So total amount investor gets $270mn + $200mn = $470mn

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The money an investor make while selling the company depends on the method of valuation and the agreement enter into between the investors and the organisation