Coursera IPO Model

Prepared by - Madhuri Thakur, Content Director at WallStreetMojo

Email: madhuri@wallstreetmojo.com
Website: www.wallstreetmojo.com
Learn step by step Financial Modeling here - https://www.wallstreetmojo.com/financial-modeling-in-excel/

Core Financial Statements

Income Statement
Balance Sheet
Cash Flows

Supporting Financial Modeling Schedules

Ratio Analysis
Revenue Built-up
Cost Sheet
Working Capital
Depreciation Schedule
Amortization Schedule
Shareholder's Equity
Debt Schedule
Shares Oustanding

Valuations
Option Value
DCF Valuation
Relative Valuation

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Disclaimer: Coursera IPO Model is for educational purposes only.

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Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020
Income
Revenue 184.41 293.51

Cost of Revenue 89.59 138.85

Gross Profit 94.82 154.67

Operating Expenses
Research and development 56.36 76.78
Sales and marketing 57.04 107.25
General and administrative 29.81 37.215
Total operating expenses 143.22 221.25

(Loss)/Profit from operations (48.39) (66.58)

Interest income 3.28 1.18

Interest expense (0.63) (0.01)
Other income (expense), net (0.26) 0.12
Loss before income taxes (46.00) (65.30)
Income Tax expense 0.72 1.52
Net loss (46.72) (66.81)

Tax Rate -1.56% -2.32%

EBITDA
Loss from Operations (EBIT) (46.72) (66.82)
Add: Depreciation and Amortization 5.28 9.58
Subtract: Interest Income (net) 2.66 1.16
Add: Stock-based compensation 16.32 16.81
Add: Income tax expense 0.72 1.52
Add: Payroll tax expense related to stock-based activities 0.13 0.26
Adjusted EBITDA (25.12) (40.42)

Stock-based compensation 16.32 16.81

% Sales 8.8% 5.7%

Diluted Weighted Average Shares (millions) 108.50 107.77

Earnings Per Share

Basic (0.43) (0.62)
Diluted (0.43) (0.62)
Net loss per share attributable to common stockholders—
basic and diluted (1.45) (1.80)

Weighted average shares used in computing net loss per share

attributable to common stockholders—basic and diluted 32,276,258 37,207,492

Pro forma net loss per share attributable to common

stockholders—basic and diluted (unaudited) -0.62

Weighted-average shares used in computing pro forma net

loss per share attributable to common stockholders—basic
and diluted (unaudited) 108,503,105
 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

454.8 687.1 1,012.9 1,458.0 2,051.3

181.90 274.84 405.17 583.21 820.51

272.86 412.26 607.75 874.82 1230.77

97.5 123.8 157.3 196.6 235.9

181.9 274.8 405.2 437.4 512.8
68.2 103.1 151.9 175.0 205.1
347.63 501.75 714.39 808.98 953.87

(74.78) (89.49) (106.64) 65.84 276.90

0.02 0.00 0.00 0.01 0.12

(0.12) (0.59) (1.64) (1.08) -
- - - - -
(74.88) (90.08) (108.27) 64.77 277.02
- - - - -
(74.88) (90.08) (108.27) 64.77 277.02

0.00% 0.00% 0.00% 0.00% 0.00%

(74.78) (89.49) (106.64) 65.84 276.90

24.32 38.57 60.87 90.67 134.02

25.01 37.79 55.71 80.19 112.82

- - - - -

(25.45) (13.13) 9.95 236.71 523.73

25.01 37.79 55.71 80.19 112.82

5.5% 5.5% 5.5% 5.5% 5.5%

107.8 107.8

(0.69) (0.84)
Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020
Assets
Current Assets
Cash and cash equivalents 55.99 79.88
Marketable securities 116.83 205.40
Accounts receivable 16.66 40.72
Deferred costs 7.66 14.08
Prepaid expenses and other current assets 9.38 14.99
Total Current Assets 206.51 355.07

Property, equipment and software, net 14.04 18.64

Operating lease right-of-use assets - 21.62
Intangible assets, net 8.09 10.57
Restricted cash 3.09 2.55
Other assets 4.53 9.17
Total Assets 236.26 417.62

Equity and Liabilities

Redeemable convertible preferred stock: 332.68 462.29
Stockholders’ (deficit) equity: - -
Additional paid-in capital 94.36 126.41
Treasury stock (4.70) (4.70)
Accumulated other comprehensive income 0.07 0.02
Accumulated deficit (276.74) (343.55)
Total stockholders’ (deficit) equity (187.00) (221.82)

Current liabilities
Educator partners payable 21.03 39.01
Other accounts payable 5.37 12.90
Accrued compensation and benefits 8.08 13.00
Operating lease liabilities, current - 7.93
Deferred revenue, current 39.20 76.08
Other current liabilities 9.30 4.74
Total Current Liabilities 82.99 153.64

Operating lease liabilities, non-current - 18.31

Other liabilities 5.19 0.64
Deferred revenue, non-current 2.40 4.56
Total Liabilities 90.58 177.16

Total Equity and Liabilities 236.26 417.62

Check: 0.0 0.0

 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

7.55 5.00 5.00 43.10 439.49

205.40 205.40 205.40 205.40 205.40
62.30 94.12 138.76 199.73 281.00
18.19 27.48 40.52 58.32 82.05
22.74 34.36 50.65 72.90 102.56
316.17 366.37 440.32 579.46 1,110.50

19.32 17.34 9.31 (6.26) (36.04)

21.62 21.62 21.62 21.62 21.62
15.13 23.20 36.20 55.87 84.96
- - - - -
9.17 9.17 9.17 9.17 9.17
381.42 437.70 516.62 659.85 1,190.22

- - - - -

588.70

165.59 75.51 (32.76) 32.01 309.03

50.83 76.81 113.22 162.98 229.29

16.94 25.60 37.74 54.33 76.43
17.28 26.11 38.49 55.41 77.95
3.11 55.25 108.31 - -
100.05 151.16 222.84 320.77 451.28
9.10 13.74 20.26 29.16 41.03
197.31 348.67 540.87 622.64 875.98

13.31 8.31 3.30 - -

0.64 0.64 0.64 0.64 0.64
4.56 4.56 4.56 4.56 4.56
215.83 362.19 549.38 627.84 881.19

381.42 437.70 516.62 659.85 1,190.22

0.0 0.0 0.0 0.0 0.0

Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019
Cash flows from operating activities
Profit/(Net loss) (46.7)
Adjustments for :
Depreciation and amortization 5.28
Stock-based compensation 16.32
Amortization or accretion of marketable securities (1.12)
Other: 0.04
Changes in operating assets and liabilities:
Accounts receivable, net (6.16)
Prepaid expenses and other assets (6.62)
Operating lease right-of-use assets -
Educator partners and other accounts payable 6.62
Accrued and other liabilities (0.82)
Operating lease liabilities -
Deferred revenue 11.84
(Increase) / Decrease in Working Capital
Net cash used in operating activities (a) (21.33)

Cash flows from investing activities

Purchases of marketable securities (166.93)
Proceeds from maturities of marketable securities 115.32
Asset acquisition (3.35)
Purchases of property, equipment, and software (4.41)
Capitalized internal-use software costs (5.52)
Purchase of investment in private company -
Net cash used in investing activities (b) (64.89)

Cash Flow available for Financing Activities (86.22)

Cash flows from financing activities

Proceeds from issuance of redeemable convertible preferred stock, net of issuance c 104.82
Proceeds from exercise of stock options and warrants 8.29
Proceeds from exercise of unvested options, net of repurchases 0.50
Repayment of debt associated with asset acquisition (0.23)
Payment of holdback consideration related to asset acquisition -
Payment of deferred offering costs -
Repayment of Liabilities
Net cash provided by financing activities (c) 113.38

Net increase in cash, cash equivalents, and restricted cash (a+b+c) 27.16
Cash and cash equivalents as at beginning of the year 32.68
Cash and cash equivalents as at end of the year 59.85
Historicals Forecasts
FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

(66.8) (74.9) (90.1) (108.3) 64.8 277.0

-
9.58 24.32 38.57 60.87 90.67 134.02
16.81
(0.00)
0.09

(24.14)
(18.25)
5.17
25.65
3.72
(5.83)
39.04
15.05 46.48 65.18 89.05 118.68
(14.99) (35.51) (5.03) 17.78 244.49 529.72

(218.46)
129.93
-
(3.10) (29.56) (44.66) (65.84) (94.77) (133.33)
(8.82)
(1.00)
(101.44) (29.56) (44.66) (65.84) (94.77) (133.33)

(116.43) (65.07) (49.69) (48.06) 149.72 396.38

129.61
10.12
0.08
-
(0.77)
(0.03)
(9.81) 47.14 48.06 (111.62) -
139.01 (9.81) 47.14 48.06 (111.62) -

22.58 (74.88) (2.55) - 38.10 396.38

59.85 82.43 7.55 5.00 5.00 43.10
82.43 7.55 5.00 5.00 43.10 439.49
Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020
Ratio Analysis

Solvency Ratios
Current ratio 2.49 2.31
Quick ratio
Cash ratio 0.67 0.52

Receivables turnover 11.07 7.21

Payables turnover 3.17
164.34

Operating Efficiency
Total asset turnover 0.78 0.70
Equity turnover (0.99) (1.32)

Operating Profitability
Gross Profit Margin 0.51 0.53
Operating Profit Margin
Net Profit Margin (0.25) (0.23)

Return on total capital

ROE (Net Income / Common Equity) 0.25 0.30

ROE DuPont Analysis

Profit Margin (0.25) (0.23)
Asset Turnover 0.78 0.70
Financial Leverage (1.26) (1.88)
ROE 0.25 0.30

Financial Risk Ratios

Debt to equity ratio (0.08)
Debt ratio 0.38 0.42
 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

1.60 1.05 0.81 0.93 1.27

0.04 0.01 0.01 0.07 0.50

7.30 7.30 7.30 7.30 7.30

2.92 3.02 3.01 2.99 2.97
197.78 309.47 453.73 649.55 908.93

1.19 1.57 1.96 2.21 1.72

2.75 9.10 (30.92) 45.55 6.64

0.60 0.60 0.60 0.60 0.60

(0.16) (0.13) (0.11) 0.04 0.14

(0.45) (1.19) 3.31 2.02 0.90

(0.16) (0.13) (0.11) 0.04 0.14

1.19 1.57 1.96 2.21 1.72
2.30 5.80 (15.77) 20.61 3.85
(0.45) (1.19) 3.31 2.02 0.90

0.08 0.11 (0.10) 0.00 0.00

0.57 0.83 1.06 0.95 0.74
Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2017 FY 2018
Growth Analysis and Drivers

Segment-wise Revenue:
Consumer Segment Revenue (a) 85.67 107.55
% yoy 26%

Enterprise Segment Revenue (b) 7.42 26.81

% yoy 261%

Degrees Segment Revenue (c) 2.54 7.41

% yoy 191%

Total Revenue (a+b+c) 95.63 141.77

% yoy 48%
Historicals Forecasts
FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

121.01 192.91 299.01 448.51 650.34 910.48 1,229.15

13% 59% 55% 50% 45% 40% 35%

48.26 70.78 99.10 133.78 173.92 217.40 260.87

80% 47% 40% 35% 30% 25% 20%

15.14 29.82 56.65 104.81 188.66 330.15 561.26

104% 97% 90% 85% 80% 75% 70%

184.41 293.51 454.76 687.11 1,012.92 1,458.03 2,051.28

30% 59% 55% 51% 47% 44% 41%
Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020

Revenue 184.41 293.51

Cost of Revenue 89.59 138.85

% Sales 49% 47%

Operating Expenses:
Research and development expenses 56.36 76.78
% Sales 31% 26%

Sales and marketing expenses 57.04 107.25

% Sales 31% 37%

General and administrative expenses 29.81 37.22

% Sales 16% 13%
 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

454.76 687.11 1,012.92 1,458.0 2,051.3

181.90 274.84 405.17 583.21 820.51

40% 40% 40% 40% 40%

97.52 123.84 157.28 196.60 235.92

27% 27% 27% 25% 20%

181.90 274.84 405.17 437.41 512.82

40% 40% 40% 30% 25%

68.21 103.07 151.94 174.96 205.13

15% 15% 15% 12% 10%
Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020
Net Sales 184.41 293.51
Cost of Sales 89.59 138.85

Accounts receivable 16.66 40.72

Deferred costs 7.66 14.08
Prepaid expenses and other current assets 9.38 14.99
Total Non Cash Current Assets 33.70 69.79

Educator partners payable 21.03 39.01

Other accounts payable 5.37 12.90
Accrued compensation and benefits 8.08 13.00
Deferred revenue, current 39.20 76.08
Other current liabilities 9.30 4.74
Total Current Liabilities 82.99 145.72

Net Working Capital (49.30) (75.93)

(Increase) / Decrease in Working Capital 26.63

Ratios & Assumptions

365
Accounts receivable 33.0 50.6

Deferred costs 7.66 14.08

% of COGS 8.55% 10.14%

Prepaid expenses and other current assets 9.38 14.99

% of Sales 5.08% 5.11%

Educator partners payable 85.69 102.54

Other accounts payable 21.89 33.90

Accrued compensation and benefits 8.1 13.0

% of COGS 9.02% 9.36%

Deferred revenue, current 39.2 76.1

% of COGS 43.76% 54.79%

Other current liabilities 9.3 4.7

% of Sales 5.05% 1.61%
 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025
454.76 687.11 1,012.92 1,458.03 2,051.28
181.90 274.84 405.17 583.21 820.51

62.30 94.12 138.76 199.73 281.00

18.19 27.48 40.52 58.32 82.05
22.74 34.36 50.65 72.90 102.56
103.22 155.96 229.92 330.95 465.61

50.83 76.81 113.22 162.98 229.29

16.94 25.60 37.74 54.33 76.43
17.28 26.11 38.49 55.41 77.95
100.05 151.16 222.84 320.77 451.28
9.10 13.74 20.26 29.16 41.03
194.20 293.42 432.56 622.64 875.98

(90.98) (137.46) (202.64) (291.69) (410.37)

15.05 46.48 65.18 89.05 118.68

50.0 50.0 50.0 50.0 50.0

18.19 27.48 40.52 58.32 82.05

10% 10% 10% 10% 10%

22.74 34.36 50.65 72.90 102.56

5% 5% 5% 5% 5%

102 102 102 102 102

34 34 34 34 34

17.28 26.11 38.49 55.41 77.95

9.50% 9.50% 9.50% 9.50% 9.50%

100.05 151.16 222.84 320.77 451.28

55% 55% 55% 55% 55%

9.10 13.74 20.26 29.16 41.03

2% 2% 2% 2% 2%
Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020
Net Sales 184.41 293.51
Capital Expenditures 7.76 3.10
Capital Expenditures as % of Net Sales 4.2% 1.1%

Beginning Net PP&E

Capital Expenditures
(Depreciation Expense)
(Asset Sales )
Ending Net PP&E 18.6

PPE (Break-up for 2020) Amount Useful Life

Internal-use software 21.58 2
Computer equipment and software 2.93 2
Leasehold improvements 7.06 2
Furniture and fixtures 2.97 5
Total 34.54

Total Capex
Breakup
Internal-use software
Computer equipment and software
Leasehold improvements
Furniture and fixtures

Internal-use software - Straight Line Method

Useful Life 2
Internal Use software 21.582
Depreciation Expense (existing)

Year Capex Useful Life

2021 14.21 2
2022 21.47 2
2023 31.65 2
2024 45.55 2
2025 64.09 2
(a) Depreciation: Internal-use software

Computer equipment and software - Straight Line Method

Useful Life 2
Computer equipment and software 2.928
Depreciation Expense (existing)
 Year Capex Useful Life
2021 1.93 2
2022 2.91 2
2023 4.29 2
2024 6.18 2
2025 8.69 2
(b) Depreciation: Computer equipment and software

Leasehold improvements - Straight Line Method

Useful Life 2
Computer equipment and software 7.057
Depreciation Expense (existing)

Year Capex Useful Life

2021 4.65 2
2022 7.02 2
2023 10.35 2
2024 14.89 2
2025 20.96 2
(c) Depreciation: Leasehold improvements

Furniture and fixtures - Straight Line Method

Useful Life 5
Computer equipment and software 2.973
Depreciation Expense (existing)

Year Capex Useful Life

2021 1.96 2
2022 2.96 2
2023 4.36 2
2024 6.27 2
2025 8.83 2
(d) Depreciation: Furniture and fixtures

Total Depreciation Expense (a+b+c+d)

 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025
454.76 687.11 1,012.92 1,458.03 2,051.28
22.74 34.36 50.65 72.90 102.56
5.0% 5.0% 5.0% 5.0% 5.0%

18.6 19.3 17.3 9.3 -6.3

22.7 34.4 50.6 72.9 102.6
(22.06) (36.34) (58.68) (88.47) (132.34)

19.3 17.3 9.3 (6.3) (36.0)

Proportion of Assets
62.5%
8.5%
20.4%
8.6%

FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

14.21 21.47 31.65 45.55 64.09
1.93 2.91 4.29 6.18 8.69
4.65 7.02 10.35 14.89 20.96
1.96 2.96 4.36 6.27 8.83

10.791 10.791 10.791 10.791 10.791

3.55 7.10 7.10 7.10 7.10

5.37 10.73 10.73 10.73
7.91 15.82 15.82
11.39 22.78
16.02
14.34 23.26 36.54 55.84 83.25

1.464 1.464 1.464 1.464 1.464

 0.48 0.96 0.96 0.96 0.96
0.73 1.46 1.46 1.46
1.07 2.15 2.15
1.54 3.09
2.17
1.95 3.16 4.96 7.58 11.29

3.53 3.53 3.53 3.53 3.53

1.16 2.32 2.32 2.32 2.32

1.75 3.51 3.51 3.51
2.59 5.17 5.17
3.72 7.45
5.24
4.69 7.61 11.95 18.26 27.22

0.59 0.59 0.59 0.59 0.59

0.49 0.98 0.98 0.98 0.98

0.74 1.48 1.48 1.48
2.18 2.18 2.18
1.57 3.14
2.21
1.08 2.31 5.23 6.80 10.58

22.06 36.34 58.68 88.47 132.34

Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020
Net Sales 184.4 293.5
Additions to Intangibles 4.0
Additions to Intangibles as % of Net Sales 1.3%

Beginning Net Intangibles

Additions to Intangibles
(Amortization Expense)
(Intangible Sales and write offs)
Ending Net Intangibles 10.6
 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025
454.8 687.1 1,012.9 1,458.0 2,051.3
6.8 10.3 15.2 21.9 30.8
1.5% 1.5% 1.5% 1.5% 1.5%

10.6 15.1 23.2 36.2 55.9

6.8 10.3 15.2 21.9 30.8
(2.258) (2.235) (2.198) (2.201) (1.678)

15.1 23.2 36.2 55.9 85.0

Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020

Beginning Equity Balance

Net Income
Issuance/ (Repurchase) of Equity
Ending Equity Balance (221.8)
 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

240.5 165.6 75.5 (32.8) 32.0

(74.9) (90.1) (108.3) 64.8 277.0

165.6 75.5 (32.8) 32.0 309.0

Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019 FY 2020
Cash Flow Available for Financing Activities
Proceeds from/ (Repurchase of) Equity
+ Beginning Cash Balance
- Minimum Cash Balance
Cash Available for Debt Repayment
Long Term Debt Issuance
Long Term (committed Payments)
Cash Available for Revolving Credit Facility

Additional Revolving Credit Facility

Beginning Balance
Discretionary (Paydown)/ Borrowings
Ending Balance 7.926

Long Term (commited payments)

Beginning Balance
Issuance
(Repayment/ Amortization)
Ending Balance 18.305

Interest Expense Calculation

1) Revolving Credit Facility Average

Interest rate
Interest Expense (Revolving Credit)

2) Long Term (committed) Average

Interest rate
Interest Expense (Long Term)

Cash Balances

Average Cash Balance Average Cash Balance

Interest Rate Interest Rate
Interest Earned
 Forecasts
FY 2021 FY 2022 FY 2023 FY 2024 FY 2025
(65.07) (49.69) (48.06) 149.72 396.38
0 0 0 0 0
79.88 7.55 5.00 5.00 43.10
(5) (5) (5) (5) (5)
9.81 (47.14) (48.06) 149.72 434.49
0.00 0.00 0.00 0.00 0.00
(5) (5) (5) (3) 0
4.81 (52.14) (53.06) 146.41 434.49

7.93 3.11 55.25 108.31 0.00

(4.81) 52.14 53.06 (108.31) 0.00
3.11 55.25 108.31 0.00 0.00

18.31 13.31 8.31 3.30 0.00

(5) (5) (5) (3) 0

13.31 8.31 3.30 0.00 0.00

5.52 29.18 81.78 54.16 0.00

2.0% 2.0% 2.0% 2.0% 2.0%
0.11 0.58 1.64 1.08 0.00

15.81 10.81 5.81 1.65 0.00

0.07% 0.07% 0.07% 0.07% 0.07%
0.01 0.01 0.00 0.00 0.00

44.99 6.27 5.00 24.05 241.29

0.05% 0.05% 0.05% 0.05% 0.05%
0.02 0.00 0.00 0.01 0.12
Coursera IPO Model

Assumptions

Inputs for Black-Scholes Model

Enter the current stock price = 33 $33 is expected IPO price;
Enter the strike price on the option = 4.6
Enter the expiration of the option = 7.75
Enter the standard deviation in stock prices = 96.43%
Enter the annualized dividend yield on stock = 0.00%
Enter the treasury bond rate = 1.73%
Enter the number of warrants (options) outstanding = 32.46
Enter the number of shares outstanding = 130,271

Calculation of Coursera Option

Stock Price= 33
Strike Price= 4.6
Adjusted S = 33.0
Adjusted K = 4.6
Expiration (in years) = 7.75

Options Issued 32
Total Shares outstanding 130,271
T Bond Rate 1.73%
Variance 0.9299
Annualized dividend yield 0.00%
Interest Rate 1.73%

d1 = 2.1262
N (d1) = 0.9833

d2 = -0.5583
N (d2) = 0.2883

Value per Coursera's option = $ 31.29

Value of all Coursera's options outstanding = $1,016

Coursera IPO Model
(All Data is in Millions $, Except Per Share Information)

Common Shares

Current Structure
-
Ordinary Shares 115,606,690
Ordinary Shares Issued through IPO 14,664,776
130,271,466

Options Data

Weighted-
Shares Subject to Average Exercise
Outstanding Options Price
Outstanding at Dec 31 2019 (i) 28,965,640
Options granted 10,054,450
Options exercised (4,240,315)
Cancelled/forfeited/expired (2,321,367)
Outstanding at December 31, 2020 (i) 32,458,408 4.6

Total Number of outstanding options provided in the prospectus 32,458,408

(see below)
Weighted-Average Remaining Aggregate Intrinsic Value
Contractual Life (Years) (in thousands)

7.75
Coursera IPO Model Historicals
(All Data is in Millions $, Except Per Share Information) FY 2019

EBIT
Free Cash Flow to Firm
EBIT x (1-t)
Add: Depreciation & amortization
Less: Capex
Add: Change in working capital
FCFF

Terminal Value

WACC Inputs

Cost of Equity & Cost of Debt

Risk Free Rate 1.73%

Beta 0.89
Equity Risk Premium 4.72%
Cost of equity 5.93%
Terminal Growth Rate 1.50%

Market Value of Equity

Current Stock Price 41.01
Current shares outstanding 130.27
Options/Warrants Converts
Fully converted shares
Fully converted equity value 5342.43

Calculating Book value of Debt

Short-Term Debt 7.9
Straight Long-Term Debt 18.3
Value of Debt 26.23

Calculating Debt to Equity ratio

Proporiton of Equity in the Capital Strucuture 99.5%
Proporiton of Debt in the Capital Strucuture 0.5%
Debt to equity ratio 0.005

WACC Calculations
Risk Free rate 1.73%
Market risk premium 4.7%
 Levered beta of company 0.89
Cost of equity 5.93%
Pre-tax cost of debt 0.07%
Tax rate 2.3%
After tax cost of debt 0.06%
WACC 5.90%

Free cash flow to firm of explicit period (2021E to 2025E)

Cash Flows
NPV of explicit period 342

Terminal value @ perpetual growth

Terminal value
NPV of terminal value 7,392

DCF Valuation Summary

DCF calculation as of Valuation Target (Year end)

NPV of explicit period 342 420
NPV of terminal value 7,392 7,828
Enterprise Value 7,734 8,248
+ Cash 79.88 7.55
- Debt (26.23) (16.42)
Equity value 7,787 8,239
+ Marketable securities, restricted cash 208 205
-Stock Option Value 1,015.53 1,015.53
Adjusted Equity Value 6,980 7,429
Share Price 53.58 57.03

Sensitivity Analysis

53.58
1.0%
1.5%
Growth

2.0%
2.5%
3.0%
3.5%
Historicals Forecasts
FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025

(74.8) (89.5) (106.6) 65.8 276.9

(74.8) (89.5) (106.6) 65.8 276.9

24.3 38.6 60.9 90.7 134.0
(22.7) (34.4) (50.6) (72.9) (102.6)
15.1 46.5 65.2 89.0 118.7
(58.1) (38.8) (31.2) 172.7 427.0

9,846.10
 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025
(58) (39) (31) 173 427

0 0 0 0 9,846

WACC
5.00% 5.91% 6.00% 6.91% 7.00%
Coursera IPO Model
(All Data is in Millions $, Except Per Share Information)

Date 20-Apr-21

Comparable Company Analysis

Price # of shares Debt Cash

EdTech Sector
Pluralsight 22.5 111.8 497.3 8148.0
Chegg 90.7 125.4 1506.9 464.8
American Public Education Inc 32.75 15.1 0.0 227.7
Zovio Inc 3.63 32.8 2.98 35.5
Grand Canyon Education Inc 112.59 46.9 107.8 245.8
2U Inc 36.7 67.1 273.2 500.6

Mean
Median

Coursera 41.01 130.27 26.2 79.9

EBITDA (consensus)
EdTech Sector FY2020A EBITDA Margin FY 2021E (Sales) FY 2022E (Sales)
Pluralsight (112.85) -29.0% 450.5 540.4
Chegg 127.85 19.84% 790.46 962.75
American Public Education Inc 38.59 15.98% 415.84 512.73
Zovio Inc 98.14 5.37% 308.15 493
Grand Canyon Education Inc 367.19 37.24% 925.18 1000
2U Inc (94.21) 6.00% 932.25 1082

That $7 billion valuation is more than many experts in the ed-tech space anticipated based on the valuation of other publicly traded com
https://www.insidehighered.com/news/2021/04/09/coursera-valuation-exceeds-expectations
 EPS
Market Cap Enterprise Value EBITDA Net Income FY 2020 FY 2021

3335.0 (4315.7) (112.85) (128.1) (1.15) (0.11)

12860.0 13902.1 127.85 (6.2) (0.03) 1.6
611.5 383.8 38.59 18.82 1.25 1.74
118.9 86.4 98.14 (48.95) (1.53) 0.09
5278.0 5140.0 367.19 257.20 5.49 6.18
2716.0 2488.5 (94.21) (216.5) (3.2) (0.4)

0.14 1.52
(0.59) 0.87

5342.4 5288.8 (55.7) (66.8) (0.62) (0.69)

EBITDA-2021 EBITDA-2022
(130.63) (156.71)
156.83 191.01
66.45 81.93
16.55 26.47
344.54 372.40
55.93 64.92

n of other publicly traded companies that support online degrees and workforce training such as 2U, Grand Canyon Education, Pluralsight, Adtalem, the Le
 EPS P/E (x) EV / EBITDA (x)
FY 2022 FY 2020 FY 2021 FY 2022 FY 2020 FY 2021 FY 2022

0.04 -19.5x -204.1x 561.3x 38.2 33.0 27.5

2.2 -3021.7x 55.3x 40.5x 108.7 88.6 72.8
1.84 26.2x 18.8x 17.8x 9.9 5.8 4.7
0.00 -2.4x 40.3x - 0.9 5.2 3.3
6.84 20.5x 18.2x 16.5x 14.0 14.9 13.8
0.0 -11.4x -91.8x 1223.7x (26.4) 44.5 38.3

1.83 (501.38) (27.20) 371.93 24.23 32.01 26.73

0.94 (6.89) 18.52 40.47 11.97 23.98 20.67

(0.84) (66.1) (59.0) (49.1) (130.8) (207.9) (402.9)

Education, Pluralsight, Adtalem, the Learning Technologies Group and Zovio. Coursera's market cap is far ahead of that of 2U, which is valued at about $3 b
f 2U, which is valued at about $3 billion, but trails just behind education publishing giant Pearson, valued at $8.3 billion.