Chat with us, powered by LiveChat ONLY FINANCE AND EXCEL SHEETS EXPERTS KNOCK ME PLEASE. I want a case study project and it is very important. High budget work. all the | EssayAbode

ONLY FINANCE AND EXCEL SHEETS EXPERTS KNOCK ME PLEASE. I want a case study project and it is very important. High budget work. all the

ONLY FINANCE AND EXCEL SHEETS EXPERTS KNOCK ME PLEASE.

I want a case study project and it is very important. High budget work. all the instructions and everything are in the attached files. You will work on the excel sheet. please read everything carefully and do it accordingly.  just work on the 3 yellow charts in the excel sheet, Financial projection, ev multiples and ev dcf. from those charts, you will calculate the things which are marked in yellow.  

Case assignment: Blue Haven Initiative (BHI)

Due Date: Sunday, May 8th Midnight (11:59PM)

Deliverables: Completed excel sheets and written answers to the questions (Word or PDF format only)

Group Project

Total Points: 25 or 25%

Supplements:

· Excel template

· Basic VC method

· Video: I will post it later

Case Summary

This case examines Blue Haven Initiative (BHI), an impact investing fund and family office, and one of its investments, PEGAfrica (PEG). BHI founder Liesel Pritzker Simmons' motivations for using her family wealth to start a family office focused on impact investing, as well as BHI's approach and strategy, including direct and indirect investments, fund manager selection, total returns, sourcing and due diligence of direct investments, and other aspects. The case explores a specific investment decision in depth. In May 2017, Pritzker Simmons and BHI Director of Private Investments Lauren Cochran were considering whether to invest an additional $1 million in PEG's upcoming $5 million Series B round, at a $20 million pre-money valuation. PEG offered pay-as-you-go (PAYG) financing plans that allowed customers to make small payments via mobile money to pay off financing for the solar equipment over time. The case details PEG's business model, growth strategy, financial structure, and the landscape of investment capital in West Africa during the time of the case.

Objectives:

Perform a valuation analysis and consider the potential financial and impact returns of an early- stage social enterprise venture in an uncertain developing market

Assignment questions: Guidance

1. What do you think of the total portfolio approach? Is BHI’s way of defining and measuring impact appropriate? What are the associated costs and benefits?

a. PEG’s ability to build trusting relationships with customer households represents a broader opportunity to improve customer access to financing and grow local economy

b. PEG has already begun offering access to insurance and healthcare products, which may indicate commitment impact goals

c. PEG’s target market and business model align with BHI’s stated goals of investing in companies working with underserved segments and of increasing financial inclusion.

2. Is PEG’s business model and strategy sound? What are the drivers of its financial performance? How is the company driving impact? Assess the sustainability of its financial thesis. What are the risks?

a. PEG’s value proposition is strong. Saving customers $1,000 while paying off the financing in just 18 months

b. How the Ghanian and broader West African market?

c. PEG’s margin of 30% are strong and stand to improve further with the switch in suppliers

d. How is the relationship with customers and the potential to expand product offering using the same PAYG model. PEG is already started offering health insurance policies using mobile money to make premium payments.

e. Can PEG potentially offer PAYG financing for additional products?

f. Low capex business with recurring revenue stream

g. Expand on its differentiation: focusing on financing and colleting household date rather than focusing on the home solar technology

h. Issues like high level of working capital need due to paying SHS manufactures upfront but collecting revenue over time. Does it have any impact on margin

FCF is negative for the entire projection period through 2021.

i. Explain currency risk by purchasing inventory in US dollars while collecting revenue in Ghanaian cedi. How devaluation of cedi impact in margin

j. Address the constant need for capital given projected negative FCF. Are you concerned about sufficient source of funding?

k. Is there a concentration risk by being exposed to M-KOPA.

3. What is PEG’s enterprise value? Is the valuation of $20 million pre-money reasonable? Use the excel template provided to perform the following analysis

a. Comparable company analysis on revenues and EBITDA multiple

b. Discounted cash flow analysis. Use Blue have post series B % of 10% not 12% (I made a mistake). Net debt = Debt – Cash, additional cash should be added. Equity value increase by that amount. Use exit ownership if 12%. Use EBIT (2021)

c. Valuation based on “basic venture capital formula”

Use 30% IRR $1 million investment, apply an appropriate EBITDA multiple to terminal EBITDA and find the ownership.

4. Should BHI participate in Series B or not? Why? If so, should it provide the bridge, and in what form?

The term sheet for the bridge must protect the BHI

a. Talk about governance: board seat, right to approve/veto business decisions if certain performance thresholds are not first met

b. Exit rights: right to exit if PEG is not successful in bringing on additional investors. Right to preferential liquidation over later investors

c. Establish ESOP. High quality local sales people are essential to PEG’s success. The ESOP should incentivize them.

d. Should BHI negotiate for a $1 million investment based on a lower pre-money valuation, thereby increasing its stake. Should they include anti-dilution provisions to protect against any down round.

e. Should the bridge financing be structured as a convertible bond.

f. Should PEG develop and report on impact measures?

,

Copyright

Blue Haven Initiative: The PEGAfrica Investment
Harvard Business School Case 318-003
Courseware 318-705
This courseware was prepared solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2018 President and Fellows of Harvard College. No part of this product may be reproduced, stored in a retrieval system, used in a spreadsheet or transmitted in any form or by any means—electronic, mechanical, photocopying, recording or otherwise—without the permission of Harvard Business School.

Instructions

Instructions:
This courseware was created to allow students to determine PEGs enterprise value (EV) in early 2017. Yellow cells indicate where students provide inputs. The other worksheets provide information to help students make decisions about their inputs.

Financial projection

PEG Africa Financial Statements and Blue Haven Projections
$ in US Dollars 2015A 2016A 2017 E 2018 E 2019 E 2020 E 2021 E
Income Statement
Revenue
Unit Sales 6000 9,200 20,000 40000 74000 127465 205744
Y/Y Growth 100% 85% 72% 61%
Rev/sale (USD) 209.90 250 $ 300 $ 425 $ 425 $ 425 $ 425
Total Revenue 1,259,376 2,300,000 6,000,000 17,000,000 31,450,000 54,172,625 87,441,388
Cost of Goods Sold
Total Cost of Goods Sold 818,594.40 1,610,000 3,600,000 8,500,000 15,725,000 27,086,313 43,720,694
% of Revenues 65% 70% 60% 50% 50% 50% 50%
Gross Profit 440,782 690,000 2,400,000 8,500,000 15,725,000 27,086,313 43,720,694
35% 30% 40% 50% 50% 50% 50%
Operating Expenses
Total Operating Expenses 881,563 1,700,000 2,900,000 4,387,182 5,329,647 6,557,149 8,202,226
% of Revenues 70% 74% 48% 26% 17% 12% 9%
Write-off expense (200,000) (575,000) (1,500,000) (1,700,000) (3,145,000) (5,417,263) (8,744,139)
% of Revenues 25% 25% 10% 10% 10% 10%
EBITDA (640,782) (1,585,000) (2,000,000) 2,412,818 7,250,353 15,111,901 26,774,329
Depreciation (30,000) (90,000) (105,859) (129,000) (150,000) (175,000)
EBIT (640,782) (1,615,000) (2,090,000) 2,306,960 7,121,353 14,961,901 26,599,329
Cash Flow Statement
Net Working Capital 2150000 4,500,000 12,750,000 23,587,500 46,046,731 71,701,938
% of Sales 75% 75% 75% 85% 82%
PBT (2,090,000) 2,007,055 6,195,577 13,016,854 23,141,417
Depreciation 90,000 105,859 129,000 150,000 175,000
Increase In Net Working Capital 2,350,000 8,250,000 10,837,500 22,459,231 25,655,207
Cash flow from Operating activities (4,350,000) (6,137,086) (4,512,923) (9,292,378) (2,338,791)
Capex (142,863) (142,863) (155,245) (156,832) (164,619) (186,576)
% of Sales 2.38% 0.91% 0.50% 0.30% 0.21%
Net cash from investing activities (142,863) (142,863) (155,245) (156,832) (164,619) (186,576)

EV-Multiples

PEG Ghana Estimated Series B Returns – Multiples Exit Analysis
$ in US Dollars 4/15/16 6/1/17 12/31/19 12/31/21
EBITDA Multiples Analysis
Forecasted EBITDA Year 2021
Multiple 4.5x
Enterprise Value
Less net debt* 0
Equity Value – 0
Blue Haven ownership at exit * 12%
Blue Haven Cash Flows* -1000000 -1000000 -2500000 0
IRR
Revenue Multiples Analysis
Forecasted Revenue year 2021
Multiple 2x
Enterprise Value
Less net debt* 0
Equity Value
Blue Haven ownership at exit * 12%
Blue Haven Cash Flows*
IRR
*Key Assumptions: BH invests an additional $2.5M in a series C resulting in 12% ownership at exit (See "BH Cap Table"); assumes zero net debt as all cashflow requirements funded by equity

EV-DCF

PEG Ghana Estimated Series B Returns – DCF Analysis
Dicount rate (WACC) 30%
Exit EBIT Multiple 4.5x
Period 0 1 2 3 4 5 Terminal value
Year 4/15/16 6/1/17 12/1/18 12/1/19 12/1/20 12/21/21 exit multiple x 2021 ebit
Discount Factor
EBIT
Less taxes (@13%)
Plus depreciation
Less Increase in net working capital
Less capex
FCF
Present value of FCF
Present value of Terminal Value
Present Enterprise Value of PEG*
Less net debt (plus)
Equity value
Blue Haven onwership, post Series B 10%
NPV of Blue Haven equity
Blue Haven ownership at exit* 12%
Blue Haven Cash Flows
IRR
*Key Assumptions: BH invests an additional $2.5M in a series C resulting in 12% ownership at exit (See "BH Cap Table"); Present value estimated as of January 2017 for simplicity
SENSITIVITY ANALYSIS – Present Enterprise Value of PEG, USD Millions
Student Input
Terminal Value Exit Multiple Discount Rate
– 0 25% 30% 35% 40%
3.50x
4.00x
4.50x PV of the FCF+PV of (EBIT x 4.5)/(1+.30)^5
5.00x
5.50x

BH Cap Table

Series A-2 Current Series B Assumed Series C Exit
Pre Money Valuation 8,500,000 20,000,000 60,000,000
Total Equity Investment 4,336,332 5,000,000 15,000,000
Post Money Valuation 12,836,332 25,000,000 75,000,000
Pre-Money Shares Outstanding 36,648,223 46,192,031
Shares Issued 9,543,808 11,929,760
Post Money Shares Outstanding 36,648,223 46,192,031 58,121,791
Fully diluted Prior Round Price / Share 0.3503 0.5239
Post Money Price / Share (prior to post money stock options) 0.5239 1.2574
Premium to Prior Round 50% 140%
BH Investment, $ 1000000 1000000 2500000
BH Ownership 8% 10% 12%
BH Shares 2855039 4763800 6752094
Estimated ownership at exit, assuming subsequent rounds 12% 12%
$ in US Dollars 4/15/16 6/1/17 12/31/19
Blue Haven Investment per round 1000000 1000000 2500000

Ex 4 Balance Sheet

Balance Sheet
ASSETS
Non-current assets
Property, plant and equipment 300,000 352,863
Goodwill 3,300,000 3,300,000
Current Assets
Receivables 1,500,000 4,200,000
% of Sales ERROR:#REF! 70%
Inventory 800,000 900,000
% of Sales ERROR:#REF! 15%
Cash 2,900,000 6,200,000
Total current assets 5,200,000 11,300,000
TOTAL ASSETS 8,800,000 14,952,863
Equity
Stated capital 9,500,000 14,500,000
Retained earnings -1,600,000 -4,190,000
Total shareholder's fund 7,900,000 10,310,000
Liability
Debt 750,000 3,625,000
Total non-current liabilities 750,000 3,625,000
Payables 150,000 600,000
Other liabilities 417,863
Total liabilities 900,000 4,642,863
TOTAL EQUITY AND LIABILITIES 8,800,000 14,952,863

Ex 9 Comparables

Blue Haven Initaitive Select Comparables
Company Name Headquarters Industry Code Description Revenue (TTM) – $M Net Income (TTM) – $M EBITDA (TTM) – $M Enterprise Value EV/Revenue EV/EBITDA
KCB Group (KCB) Nairobi, Kenya Banks Provider of banking services. The company provides current accounts, fixed deposits, overdrafts, loans, mortgage finance and treasury services to its clients in Kenya. 797.0 193.0 462.9 1,195.8 1.5 2.6
CAL Bank (CAL) Accra, Ghana Banks Provider of investment banking services. The company is involved primarily in meeting the banking needs of small, medium and large corporations. It provides retail banking, investment banking, corporate and institutional banking and other private banking services. 111.5 2.4 77.4 231.4 2.1 3.0
Equity Group Holdings (Kenya) (EQTY) Nairobi, Kenya Banks Provider of mortgage financing financial services. The company offers retail banking, microfinance and related services such as fixed deposit, custody investment, asset finance, money transfer, remittance processing, cheque clearing, banker's cheque, share trading, money transfer and mobile banking services. 659.8 162.0 351.7 1,564.9 2.4 4.4
Mauritius Commercial Bank (MCBG) Port Louis, Mauritius Banks Provider of commercial banking services. The company provides banking products like current account, savings accounts, fixed deposits, loans and advances and other allied services in Mauritius. 450.6 164.1 316.0 2,592.1 5.8 8.2
Capitec Bank Holdings (CPI) Stellenbosch, South Africa Banks Operator of a holding company in the banking sector. The company through its subsidiary is a retail bank focused on providing accessible banking services to its clients by the use of technology. 1,126.5 288.3 755.3 6,952.5 6.2 9.2
ACI Worldwide, Inc. (NasdaqGS:ACIW) Fintech 3,281.3 3.2 17.0
OneMain Holdings, Inc. (NYSE:OMF) Fintech 17,256.1 9.1
On Deck Capital, Inc. (NYSE:ONDK) Fintech 1,041.0 6.1
Nets A/S (CPSE:NETS) Fintech 6,302.4 5.2 18.5
Average 4.6 9.0
Median 5.2 8.2
See below for additional comparables
Comparables Data – African Financial Institutions
Date Sourced: 5/24/17
Source: PitchBook, Capital IQ
Company Name Headquarters Industry Code Description Revenue (TTM) – $M Net Income (TTM) – $M EBITDA (TTM) – $M Enterprise Value EV/Revenue EV/EBITDA
National Bank of Kenya (NBK) Nairobi, Kenya National Banks Provider of banking services. The company offers personal banking, business banking, corporate banking, agent banking and bank assurance services for individuals, small-to-medium companies and businesses and large corporations. 124 2 52 20 0.16x 0.39x
CBZ Holdings (CBZ) Harare, Zimbabwe Asset Management Operator of a holding company. The company through its subsidiaries engages in providing banking services and insurance products along with asset management services to its clients in Zimbabwe. 234 24 136 97 0.42x 0.71x
Trust Bank Gambia Company (TBL) Banjul, Gambia National Banks Provider of commercial banking services. The company provides commercial banking services to the general public in the form of receiving deposits, provision of loans, system of payments and clearing, dealing in financial instruments of the money market in Gambia. 20 4 12 20 0.98x 1.69x
GCB Bank (GCB) Accra, Ghana National Banks Provider of commercial banking services. The company provides commercial and retail banking services and products to the Ghanaian traders, business people and farmers. 230 67 132 314 1.37x 2.38x
KCB Group (KCB) Nairobi, Kenya Regional Banks Provider of banking services. The company provides current accounts, fixed deposits, overdrafts, loans, mortgage finance and treasury services to its clients in Kenya. 797 193 463 1,196 1.50x 2.58x
Access Bank (ACCE) Lagos, Nigeria International Banks Provider of international banking services in Nigeria. 1,369 274 819 2,108 1.54x 2.58x
Diamond Trust Bank Kenya (DTK) Nairobi, Kenya Regional Banks Operator of a regional bank. The company operates as a regional bank that provides various banking services which include corporate, retail and commercial banking services. 330 64 244 666 2.02x 2.73x
Standard Chartered Bank Kenya (SCBK) Nairobi, Kenya International Banks Provider of commercial banking services. The company is engaged in providing banking services such as accepting deposits, originating loans, offering deposit instruments and other related banking services. 314 89 204 635 2.02x 3.11x
CAL Bank (CAL) Accra, Ghana International Banks Provider of investment banking services. The company is involved primarily in meeting the banking needs of small, medium and large corporations. It provides retail banking, investment banking, corporate and institutional banking and other private banking services. 112 2 77 231 2.07x 2.99x
African Bank Investments (AXL) Midrand, South Africa Other Commercial Banks Operator of a holding company in the banking sector. The company operates businesses within the Republic of South Africa and in the neighboring countries of Zambia, Botswana, Lesotho, Namibia and Swaziland. It provides finance, banking and insurance services to individuals and corporations. The subsidiaries of the company include African Bank Limited, which provides unsecured personal loans to formally employed South African residents; Ellerine Holdings Limited, which engages in the business of retailing furniture and appliances for cash and credit to the markets spanning all living standards measure (LSMs); The Standard General Insurance Company Limited, which provides credit life products to clients of African Bank Limited; Theta Investments (Pty) Limited; and Relyant Insurance Company Limited, which engages in the sale of insurance to customers of Ellerines Group who purchase furniture and appliances on credit. 861 (420) 57 1,903 2.21x 33.15x
Bank Of Africa-Benin (BOAB) Cotonou, Benin Regional Banks Provider of commercial banking services. The company provides various banking and financial services like loans, savings and insurances to its customers in Benin. 102 21 62 233 2.29x 3.73x
Equity Group Holdings (Kenya) (EQTY) Nairobi, Kenya National Banks Provider of mortgage financing financial services. The company offers retail banking, microfinance and related services such as fixed deposit, custody investment, asset finance, money transfer, remittance processing, cheque clearing, banker's cheque, share trading, money transfer and mobile banking services. 660 162 352 1,565 2.37x 4.45x
Co-operative Bank of Kenya (CBK) Nairobi, Kenya Asset Management Provider of banking services. The company provides corporate banking services, retail banking services, investments and asset management services to its clients in Kenya. 513 124 322 1,433 2.79x 4.45x
Banque Marocaine pour le Commerce et l'Industrie (BMCI) Casablanca, Morocco National Banks Provider of banking and financial services. The company provides retail and corporate banking services. It also provides investment, insurance, credit and other services. 319 51 168 1,804 5.66x 10.72x
Mauritius Commercial Bank (MCBG) Port Louis, Mauritius National Banks Provider of commercial banking services. The company provides banking products like current account, savings accounts, fixed deposits, loans and advances and other allied services in Mauritius. 451 164 316 2,592 5.75x 8.20x
Capitec Bank Holdings (CPI) Stellenbosch, South Africa Other Commercial Banks Operator of a holding company in the banking sector. The company through its subsidiary is a retail bank focused on providing accessible banking services to its clients by the use of technology. 1,126 288 755 6,953 6.17x 9.21x
BICI CI Banque Internationale pour le Commerce et l'Industrie de la Cote d'ivoire (BICC) Abidjan, Ivory Coast National Banks Provider of commercial banking services. The company provides general banking, retail and wholesale banking to businesses and individuals in Ivory Coast. 93 15 52 702 7.56x 13.51x
Average 2.76x 6.27x
Median 2.07x 3.11x
Comparables Data – Emerging Markets Consumer Finance
Date Sourced: 5/24/17
Source: PitchBook, Capital IQ
Company Name Headquarters</

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