Circular Reference between Principal´s equity % calc

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by a searcher from HEC School of Management, Paris
in Barcelona, España

1yr ago

Circular Reference between Principal´s equity % calc

Hi All,
I am sure this is very easy to solve but I m kinda blocked in this circular reference where you define the Principal´s equity % depending on the level of IRR the investor take after the Principal´s equity payout. Any hints on how to solve this and model this in excel?

1 Like

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reply by an intermediary 1yr ago
in Knoxville, TN, USA

I ran into the same issue and I realized that I was overcomplicating it. I am happy to share my financial models. Send me a DM with your email and I'll send what I have.

reply by a searcher 1yr ago
from HEC School of Management, Paris in Barcelona, España

Florian, the easiest way Ifound was to make a table from 20 to 35% with the corresponding equity. Then depending on the investor IRR at 20% I manually apply the corresponding pay.