1. Analyze the strengths and weaknesses of Jonathan Miller and Element Bars.
Strengths
Strengths
Jonathan Miller is the founder and owner of the company called Element Bars. He has a professional background in venture capital, which means that he has experience with entrepreneurial endeavors and they risk they entail. Miller has successfully started other businesses in the past, beginning his entrepreneurial career in 1999. The skills he gained during these endeavors has won him a widely-recognized business plan award, as well as the money to start Element Bars. Miller has impressive entrepreneurial acumen, presentation skills, and negotiation skills. He is incredibly passionate about Element Bars, and believes strongly in the potential…show more content… This comes with its own risks and pitfalls such as the personal relationships involved.
Angel investors, like those in Shark Tank, are also an option that is perhaps more suitable for a small start-up like Element Bars. They tend to make investment decisions based on more than financial analysis; angel investors also take the viability of the business as well as the strengths and passion of the entrepreneur themselves. Individuals like this often bring their own expertise, as well as established business connections. (Shein, 2011) Out of the options listed here, angel investors are arguably the best option to provide financing to Element Bars.
3. How would you calculate the value of Element Bars? What objective and subjective data support (and undermine) your valuation? How would you defend your valuation, and how much ownership do you think Jonathan should give up?
Miller is asking for $150,000 for 15% equity in Element Bars, This means that he has valued the company at $1,000,000. In the interview, Miller told the Sharks that the company is growing at a present rate of 15% per year. According to the case, Element Bars was expected to generate an estimated revenue of $100,000 in the present year. In conducting his valuation, Miller took into account the performance and growth of similar companies in his industry, as well as overall market growth. These are important factors in this calculation.
As an investor, my required rate of return would be at least 10% on my
