In the previous two questions, how would it affect your thinking to know that in addition to the

step 1 So this file here, it is represented by the capital raised and IPOs. Now, T represents the numbe

In the previous two questions, how would it affect your...

Key Concepts

Outstanding Shares and Dilution

Outstanding shares represent the total number of shares that exist for a company, including those held by insiders and early investors. A larger pool of outstanding shares compared to the number offered in the IPO can dilute the ownership stake and influence the earnings per share. This concept is important in analyzing whether new public investors will have a significant role or be overshadowed by preexisting concentrated holdings.

Insider and Institutional Ownership

The distribution of shares among insiders, such as directors and executive officers, as well as institutional investors like venture capital firms, plays a critical role in corporate governance and investor confidence. High levels of insider or institutional ownership may signal strong confidence in the company's future, but can also indicate concentrated control over decision-making, which may affect the balance of power between new public shareholders and existing stakeholders.

Initial Public Offering

An Initial Public Offering (IPO) is when a company offers its shares to the public for the first time. Understanding the proportion of shares offered in the IPO relative to the total outstanding shares is crucial. It affects how investors perceive the company's valuation, liquidity, and the potential dilution of their equity if additional shares exist beyond those offered.

Transcript

00:01 So this file here, it is represented by the capital raised and ipos.

00:06 Now, t represents the number of years since 2010.

00:10 So let's start with part a.

00:12 Part a wants to know what's going to be in 2015.

00:16 So since t represents time since 2010, we're going to use t is equal to 5.

00:22 So i'm going to do c of 5, and that's going to be equal to negative 2 .79 times 5 minus 3 squared.

00:31 Plus 34.

00:32 So what that means is we're just going to use our calculator to figure out what that equals.

00:37 So the nice thing here is 5 minus 3 is a whole number to 2 squared is 34 and then plus the 34.

00:45 So what i get here is 22 .84 as our answer.

00:50 Now this is representing the capital raise.

00:54 So this is in terms of money.

00:56 That's also in billions.

00:58 So we would do 22 .84 billion.

01:01 Billion dollars as our label.

01:05 All right, for part b, we want to know when it's going to be $30 billion, race.

01:09 So that means we're going to set it equal to 30.

01:11 But if 30 is equal to negative 2 .79 and then t minus three squared plus 34.

01:18 So step one is for us is going to be subtract.

01:21 So 30 minus 34 is a negative four.

01:23 It's okay that we're getting that negative number there because in front of the t minus three squared, we also have another negative.

01:29 So we're going to start by doing negative 4 divided by negative 2 .79.

01:34 It will be some long decimal.

01:35 So let's go ahead and round it to couple of decimal places as we write it down.

01:40 So 4 .3 is equal to t minus 3.

01:44 Now in my calculator, i'm going to take the square root of the long number.

01:48 So i have something in here like 1 .43369 -175 so on.

01:53 So i'm going to use that just to help us get a more exact answer.

01:57 So in the end, i get plus or minus 1 .123.

02:01 Places, 97 is equal to t minus three.

02:05 I'm going to go ahead and use that.

02:07 So t minus three is equal to negative 1 .197.

02:10 And then t is equal to, oops, t equals, and t minus three is equal to the positive 1 .197.

02:19 And then we're just going to add and subtract.

02:21 So negative 1 .197 plus three gets us about 1 .803.

02:27 And then 1 .197 plus 3, and this one is going to get us 4 .197.

02:35 So in the end, we have, again, this is since 2010.

02:38 So here tells us we're in the year 2011.

02:43 And then for the second one, it would be 2014...

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