MotionMedia - Sample Digital Agency Business Plan

77 © BPlanExperts.com Year 2 Investors' Shares 0 0 0 Year 3 Investors' Shares 0 0 Total Shares Outstanding 142,857 142,857 142,857 142,857 Equity Ownership Percentage Year 1 Year 2 Year 3 Year 5 Founders' Equity 49.00% 49.00% 49.00% 49.00% Option Holders' Equity 21.00% 21.00% 21.00% 21.00% Year 1 Investors' Equity 30.00% 30.00% 30.00% 30.00% Year 2 Investors' Equity 0.00% 0.00% 0.00% Year 3 Investors' Equity 0.00% 0.00% Total Equity 100.00% 100.00% 100.00% 100.00% Investors' Equity 30.00% 30.00% 30.00% 30.00% Founders' & Employees' Equity 70.00% 70.00% 70.00% 70.00% INVESTMENT ANALYSIS Start Year 1 Year 2 Year 3 Year 4 Year 5 Initial Investment Investment $600,000 $0 $0 $0 $0 $0 Dividends $0 $0 $0 $0 $0 $0 Ending Valuation $0 $0 $0 $0 $0 $98,343,000 Combination as Income Stream ($600,000) $0 $0 $0 $0 $98,343,000 Percent Equity Acquired 35% Net Present Value (NPV) $54,966,605 Internal Rate of Return (IRR) 0% Assumptions Discount Rate 10.00% Valuation Earnings Multiple 10 10 10 10 10 Valuation Sales Multiple 2 2 2 2 2 Investment (calculated) $600,000 $0 $0 $0 $0 $0 Dividends $0 $0 $0 $0 $0 Calculated Earnings- based Valuation $2,710,000 $11,530,000 $30,180,000 $82,820,000 $280,980,000 Calculated Sales-based Valuation $6,780,000 $13,710,000 $28,500,000 $60,330,000 $129,860,000 Calculated Average Valuation $4,745,000 $12,620,000 $29,340,000 $71,575,000 $205,420,000