Course 2017-2018 a.y.

20453 - VENTURE CAPITAL AND VALUATION


EMIT
Department of Finance

Course taught in English


Go to class group/s: 22

EMIT (6 credits - I sem. - OB  |  SECS-P/11)
Course Director:
LAURA BOTTAZZI

Classes: 22 (I sem.)
Instructors:
Class 22: LAURA BOTTAZZI


Course Objectives
The aim of the course is to provide students with a deep understanding of the role played by the financial intermediaries, and in particular by Venture Capital (VC), in the creation and financing of new firms. The course has an analytical nature, not an institutional or descriptive one, and covers several topics.
First, we look at raising and sourcing funding for entrepreneurial companies. We start with an introduction to Entrepreneurial Finance and review traditional sources of finance: bank loans, public grants and "family, friends and fools", and then we move to analyze un-intermediated finance, where we focus on (informal) business angels and (formal) corporate venture investors.
Next, we look at financial forecasting and financial management of entrepreneurial firms. We delve deeply into the valuation of entrepreneurial companies, the reasons why financial projections are needed in a business plan and their role for both entrepreneurs and financiers. Then, we move to the analysis of deal structuring.
Finally, we cover deal management. This can be divided into investor involvement and exit.

Intended Learning Outcomes
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Course Content Summary
  • The sources of Entrepreneurial Finance.
  • The VC Industry: a survival kit.
  • Financial contracting theory and applications.
  • The role of business plan for venture capitalists.
  • Valuation theory and valuation practice for an outside investor.
  • The analysis of deal structuring.
  • The Interaction between Product Market and Financing Strategy.
  • IPO and the effect of going public.

Teaching methods
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Assessment methods
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Detailed Description of Assessment Methods
  • The exam is written with a mix of open ended and multiple choice questions. Students can attend the partial exam on the first part of the course.
  • Class participation.
  • Group assignments.
  • Individual/group presentation.

Textbooks
  • J.K. Smith, R.L. Smith, Entrepreneurial Finance, Wiley & Sons Inc, 2004, 2nd edition.
  • Some topics are  covered by case histories/working papers that are distributed through the Personal Diary.

Prerequisites
In order to successfully attend and complete this course, students are expected to know the basics of
  • Descriptive and inferential statistics (mean, standard deviation, correlation, variance-covariance matrices, main statistical distributions, linear multivariate regressions, etc.).
  • Corporate finance theory and practice (i.e. Capital Asset Pricing Model, IRR, NPV, etc.).
Last change 24/05/2017 09:28