BU.233.730.XX –Entrepreneurial Finance– Instructor Name – Page 1 of 5

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Entrepreneurial Finance

2 Credits
BU.233.730.XX
[NOTE:Each section must have a separate syllabus.]
[DayTime/ex: Monday, 6pm-9pm]
[StartEnd Dates / ex: 3/24/15-5/12/15]
[Semester / ex: Fall 2016]
[Location / ex: Washington, DC]

Instructor

[Full Name]

Contact Information

[Email Address]

[Phone Number,(###)###-#### (Optional)]

Office Hours

[Please specify the day and time of the 2 hours that will be dedicated to office hours each week. For evening classes, faculty may wish to hold their office hours by phone or email. While faculty are permitted to state “and by appointment,” office hours should not be held exclusively by appointment.]

Required Text(s)Learning Materials

High Tech Start-Up: The complete handbook for creating successful new high tech companies. J. Nesheim, 2000, ISBN-13: 978-0684871707.

Venture Capital and the Finance of Innovation. Andrew Metrick, Wiley, Chapters 1 to 6, and 15. 2011, 2nd Edition, ISBN: 9780470454701 (update SU11)

Course Description

This course introduces students to identifying, accessing, and evaluating sources of financing for start-ups and expanding technology companies. The approach uses case studies, group interaction, and presentations from experts in the field. Attention will be given to financial theory, risk assessment, valuation options, term sheets, due diligence techniques, and the setting up of financial reports for monitoring progress toward meeting milestones.

Prerequisite(s)

BU.231.620 OR BU.910.611

Statement about Finance and Social Responsibility

The effectiveness and perceived integrity of finance have been tested in recent years. Along with preventable excesses and regrettable distortions, financial innovation has, however, always been an effective means for society to achieve its goals, from insurance to consumption to saving. The power of financial innovation as a generator of inclusive prosperity and widespread well-being can (and should be) reclaimed. In this context, optimization of shareholder’s value – for instance – may not be the only metric along which financial success is measured and should be placed, along with other traditional finance metrics, in the broader context of its contribution to society. To this extent, Carey encourages technical, non-ideological, exchanges of ideas leading to a better understanding of the broader role of finance as a force for shared prosperity. We will incorporate a reading or an in-class discussion of current events that provides an initial opportunity for technical discussions of these issues as they relate to the topics covered in Entrepreneurial Finance.

Learning Objectives

By the end of this course, students will:

  1. Understand the common organizational issues encountered in the formation of a venture-backed start-up.
  2. Review the venture capital industry today and the basics of VC.
  3. Study the valuation methodologies.
  4. Understand the challenges of fundraising, due diligence, financing strategies and the importance of the business plan and presentation.
  5. Study the funding sources and funding strategies of entrepreneurs other than VC.
  6. Understand the typical investment terms found in the term sheet and the dynamics of negotiation between the entrepreneur and the venture capitalist.

To view the complete list of Carey Business School’s general learning goals and objectives, visit the Carey website.

Attendance
Attendance and participation are part of your course grade. Participants are expected to attend all scheduled class sessions. Each class will include opportunities for teams to work together. Failure to attend class will result in an inability to achieve the objectives of the course. Excessive absence will result in loss of points for team participation. Full attendance and active participation are required for you to succeed in this course.

Assignments

Various assignments will be given throughout the course. Some may include pushing students out of their comfort zones in order to gain important skills that will become necessary for latter classes and assignments. Note that this course cumulates the knowledge and skill sets needed for the final presentations. Therefore, class attendance is highly recommended and will affect students’ grades, as shown below.

Final Presentations will be done in team-groups.

Assignment / Learning Objectives / Weight
Attendance and participation in class discussion / 1–6 / 20%
Assignments / 1–6 / 30%
Final Presentations / 1–6 / 50%
Total / 100%

Grading

Effective Fall 2017: The grade of A is reserved for those who demonstrate extraordinarily excellent performance as determined by the instructor. The grade of A- is awarded only for excellent performance. The grades of B+, B, and B- are awarded for good performance. The grades of C+, C, and C- are awarded for adequate but substandard performance.The grades of D+, D, and D- are not awarded at the graduate level (undergraduate only). The grade of F indicates the student’s failure to satisfactorily complete the course work.

Please note that for Core and Foundation courses, a maximum of 25% of students may be awarded an A or A-; the grade point average of the class should not exceed 3.3. For Elective courses, a maximum of 35% of students may be awarded an A or A-; the grade point average of the class should not exceed 3.4. (For classes with 15 students or fewer, the class GPA cap is waived.)

Tentative Course Calendar*
*The instructors reserve the right to alter course content and/or adjust the pace to accommodate class progress. Students are responsible for keeping up with all adjustments to the course calendar.

Week / Topic / Reading / Due
1 / Introduction
History / - Nesheim, Chapters 1–3
- 1.a The Legal Forms of Organization, HBS (2004)
- 1.b The Legal Protection of Intellectual Property, HBS (1998)
- 1.c Georges Doriot and American Venture Capital, HBS (2012) / Assignment1:
“Rock It”
Homework1:
“SWOT your team”
2 / The VC Industry
Basics of VC Industry
Something Ventured / -Nesheim, Chapter 9
- Metrick, Chapters 1–4
- 2.a A Note on the Venture Capital Industry, HBS(2001)
- 2.b The VC Shakeout,HBR(Jul/Aug 2010)
- 2.c How Venture Capital Works, B. Zider, HBR (1998)
- 2.d The Changing Face of Angel Investing (2010)
- 2.e 6 Myths About VCs HBR (2013) / Homework2:
“Interview WHO?”
3 / Valuation Methodologies / - Neishem, Chapter 7
- Metrick, Chapters7–9
- A Note on Valuation in Private Equity
Settings. (HBS # 9297050, April 2002)
- 3.a. Valuing Young Startup and Growth Companies, Damodaran (2009)
- 3.b. Financing New Ventures HBS (2011)
- 3.c. New Venture Financing HBS (2006) / Homework3:
“Create Your Own BP”
4 / Business Plans
Case Study Part I: / Spectrum of Business Plans: “Canvass to Monopoly”
Case Study I
- 4.a. Dropbox It Just Works HBS 2012 Eisenmann, Pao & Barley
- 4.b. PeopleAdmin
- 4.c. “Rich vs King” / Homework4:
“1 min video” & prototypes
5 / Case Study Part II: / Case Study II
- 5.a. Highbridge
- 5.b. Riskive
6 / Angel, VC and PE Future
The Platforms / - Angel List HBS
- Metrick, Chapter 15 / Homework5: “Optimal Angels?”
7 / Review Pitch / Critical analysis and participation of start-up businesses (in class assignment) / In-class review
8 / Final Shark Tank / 1-minute video, write-up, and presentation due / Final Presentation

BU.233.730.XX –Entrepreneurial Finance– Instructor Name – Page 1 of 5

Carey Business School

Policies and General Information

Blackboard Site

A Blackboard course site is set up for this course. Each student is expected to check the site throughout the semester as Blackboard will be the primary venue for outside classroom communications between the instructors and the students. Students can access the course site at Support for Blackboard is available at 1-866-669-6138.

Course Evaluation

As a research and learning community, the Carey Business School is committed to continuous improvement. The faculty strongly encourages students to provide complete and honest feedback for this course. Please take this activity seriously; we depend on your feedback to help us improve. Information on how to complete the evaluation will be provided toward the end of the course.

Disability Support Services

All students with disabilities who require accommodations for this course should contact Disability Support Services at their earliest convenience to discuss their specific needs. If you have a documented disability, you must be registered with Disability Support Services ( or 410-234-9243) to receive accommodations. For more information, please visit the Disability Support Services webpage.

Academic Ethics Policy

Carey expects graduates to be innovative business leaders and exemplary global citizens. The Carey community believes that honesty, integrity, and community responsibility are qualities inherent in an exemplary citizen. The objective of the Academic Ethics Policy (AEP) is to create an environment of trust and respect among all members of the Carey academic community and hold Carey students accountable to the highest standards of academic integrity and excellence.

It is the responsibility of every Carey student, faculty member, and staff member to familiarize themselves with the AEP and its procedures. Failure to become acquainted with this information will not excuse any student, faculty, or staff from the responsibility to abide by the AEP. Please contact the Student Services office if you have any questions. For the full policy, please visit the Academic Ethics Policy webpage.

Students are not allowed to use any electronic devices during in-class tests. Calculators will be provided if the instructor requires them for test taking. Students must seek permission from the instructor to leave the classroom during an in-class test. Test scripts must not be removed from the classroom during the test.

Student Conduct Code

The fundamental purpose of the Johns Hopkins University’s regulation of student conduct is to promote and to protect the health, safety, welfare, property, and rights of all members of the University community as well as to promote the orderly operation of the University and to safeguard its property and facilities. As members of the University community, students accept certain responsibilities which support the educational mission and create an environment in which all students are afforded the same opportunity to succeed academically. Please contact the Student Services office if you have any questions. For the full policy, please visit the Student Conduct Code webpage.

Student Success Center

The Student Success Center offers free online and in-person one-on-one and group coaching in writing, presenting, and quantitative courses. The center also offers a variety of workshops, exam study sessions, and instructor-led primer seminars to help prepare students for challenging course content, including statistics and accounting. For more information or to book an appointment, please visit the Student Success Center website.

Other Important Academic Policies and Services

Students are strongly encouraged to consult the Carey Business School’s Student Handbook and Academic Catalog and Student Resources for information regarding the following items:

  • Statement of Diversity and Inclusion
  • Inclement Weather Policy

Copyright Statement

Unless explicitly allowed by the instructor, course materials, class discussions, and examinations are created for and expected to be used by class participants only.The recording and rebroadcasting of such material, by any means, is forbidden. Violations are subject to sanctions under the Honor Code.