So I'll write that up here.

I know that look like a very strange word.

So what is the value per share?

let me give you that piece of terminology, it just means net asset value.

So here investors are valuing this company at 1 times a million shares.

Now, it's worth 250,000.

And there's only 10 shares. So they're valuing the assets at 500,000. And this is of course the market value of the assets.

levels of debt, will probably lose some money.

So its assets.

So, remember, assets are equal to liabilites plus shareholder's equity, so if all of a sudden the market value of the equity, the market capitalization, for Ben's shoe company is 215,000... (That is the equity part right over here)

I'll do that in yellow.

That assets, A for assets, is equal to

And then at the end of 2008, beginning of 2009, our balance sheet under the assets, the machine, if they gave us that

Malibu Equity and Investments.

We're willing to say that the market value of your equity is 210,000.

And what I wrote here is, it has 4 billion of liabilities.

Obviously , a machine you can't do all of those things to it, but you can at least touch it and possibly smell and taste it.

You'd have to give up 93 of your net worth.

I don't want to draw this box.

And rich, eh?

We could do a series of videos on that.

'Mr Darcy', as he calls himself, is not worth our concern, though he may be the richest man in Derbyshire.

Remember liabilities plus equities are equal to assets.

And if this little fraction right here is 189,000, then it implies what about this asset?

And it's essentially, what is the market saying the equity is worth?

Each share in this case once again, if you believe that the assets are worth 1 million are going to be 1 million.

It should start to make a little bit of intuitive sense

Malibu Equity and Investments. Roger Van Zant.

So the market is telling us that even though on the books Ben's equity based on how he values his assets and liabilities is 135,000

Or they just have a super flush bank account.

So 225,000

It's what the market is willing to give for it.

So going back to what we were talking about, what is the post money valuation?

I didn't want to go there in the first video, and that's why I just said operating profit divided by assets.

liabilities plus equity.

So over here, let's say you did it right at the beginning of the year, the asset's worth 500,000.

And there's a whole methodology to how one would account for that.

I have factory tools worth 500,000, and then that cash will go away.

So here at the beginning of this year, the asset is worth 500,000.

But the market value or assets is essentially, what is the market saying the assets are worth?

So that's the situation we're dealing with.

I won't use the square tool.

We had a 10 return on assets.

And why don't you like them as much?

And it's worth 100 gold.