Hi, I have an assignment about how a Private Equity can decide to finance start-ups. In short I need to develop a tool of relevant criteria. Any suggestions?

Question

anonymous · Answer

I would advise you to look at real option. There is an excellent article (The promise and perile of Real Option, by Aswath Damodaran) explaining how you could approach this topic.

anonymous · Answer

Financing is always very risky, and the most likely outcome is that you lose your money (if we're talking about real early-stage startups) so it has to be part of a larger portfolio to balance the risk