Drill Room
Waterfall math
Given a pref, a split, and an exit—compute who gets what. The core mechanic of every deal.
Taught in 04. Deal structure & the waterfall.
Question 1 of 5
You invest $100,000. After 5 years the deal exits, returning all capital plus $80,000 of profit on your stake. Terms: 8% annual preferred return (simple, non-compounding), then a 70/30 split. No catch-up.