Tommy Dobczyk breaks down a $1.2 million investment for 30% equity, which implies a $4 million business valuation. The key: separate the property's asset value from what the operating business actually generates in cash flow.
Are you in the deal room? Getting 30% at, at the agreement is that there's 30% to the investor on the $1.2 million, right? Is that what they're saying? Is that like total value of this project? I haven't,
I haven't reviewed it yet, but let me look.
Well, based on the raise, so if they're, they're giving away 30% equity for $1.2 million, that makes it worth $4 million.
Well, they already own the property, so this is the money that's— so it kind of doesn't really have anything to do with how much the property is worth, if that makes sense.
No, not the property, the, the deal.— it makes— so like on Shark Tank, when they say, how many units have you sold? What are you trying to— what are you trying to raise from us as the Sharks? And then how much equity are we getting? And so they base that value based on the amount of money they're trying to raise. So if they're raising $1.2 million, giving away 30% equity, that's $4 million. And
that's probably split between the actual asset and the The income from the business.
Well, right, correct. But just from a, from a, a Shark Tank perspective, like a VC perspective, they're asking for $1.2 million and giving me 30%. I'm assuming they think it's worth $4 million.
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