A Framework for Valuation and Portfolio Optimization of Venture Capital Deals with Contractual Terms

Table 14

Comparison of right-tail and utility function approach.

Test problems	Number of variables	MNPV	E	B	Right tail probability	Utility function
1	40	25	150	200	52.69	66.03
2	40	25	300	400	58,54	96.60
3	40	50	150	200	59.02	57.34
4	40	50	300	400	63.92	85.25
8	40	100	300	400	99.82	94.30
9	40	125	150	200	53.08	81.31
10	40	125	300	400	53.63	95.56
11	50	25	150	200	54,09	79.48
12	50	25	300	400	73.01	73.18
13	50	50	150	200	69.31	79.71
14	50	50	300	400	55.88	108.34
15	50	75	150	200	69.85	80.43
16	50	75	300	400	83.99	148.61
17	50	100	150	200	55.00	74.17
18	50	100	300	400	87.21	133.07
19	50	125	150	200	63.90	74.38
20	50	125	300	400	39.65	65.44
Mean					64.35	87.42