Valuation
12. Step #6 – Scenario analysis
FAQ: How is IRR calculated in the scenarios? For each scenario, the entry valuation is FIXED at $2.0 billion. The exit valuation varies by scenario as discussed.
13. Step #7 – Ability to pay
Explanatory note for slide at 11:16 Isolate revenue growth (hold multiple constant): Isolate multiple compression (hold growth constant): Because there’s no cash impact in this simplified example, add these two together you’ll get the total IRR of +7%
