NATIONAL UNIVERSITY OF SINGAPORE

NUS Business School

Department of Finance and Accounting

BMA5314A Entrepreneurial Finance

Instructor : Eugene Wong, CFA, CMC

Instructor Assistant : Nathan Budiutomo

Session : Semester 2, 2009/10

Pre-requisites : BMA 5008, Financial Management

1.  COURSE DESCRIPTION AND SCOPE

This course covers high-risk finance from the entrepreneurial and venture capital perspectives. Every start up or growing company needs to raise capital to achieve their growth strategies and expand their business overseas. Much has been written about the increased chance of venture success if high growth companies manage to seek Venture Capitalists funds and value added help and advise. How does one do this? How can an Entrepreneur attract VCs attention and their investments?

It addresses a variety of topics including preparation for fund raising, financial valuation, various sources of funds, structures and legal issues in arranging financing, private and public venture capital markets, and preparation for and execution of an initial public securities offering.

It focuses on how VCs evaluate and price their investments – processes known as sourcing, diligence and valuation, and look at how an entrepreneur can favorably affect that decision process.

Finally, It gives students an understanding of how growing companies should identify the right vision, strategies, trends and capital raising needs from the entrepreneurial perspectives. How to put all these plans into the business plans and investor presentation for effective approach to the Venture Capitalists and Angel investors.

2.  PROPOSED LECTURE AND SCHEDULE

Lecture Topic
Lesson 1
Lesson 2
Lesson 3
Lesson 4
Lesson 5
Lesson 6 / Key Issues and Challenges in Raising Funds from Investors
How to write an Effective Executive Summary and Business Plans
Developing a Good Financial Plan
How do Entrepreneurs and Investors value a Company
Term Sheet, Negotiation and Structuring the Deal
Post Fund Raising – Investment Monitoring and Exit

Cases to be discussed in class

1
2
3
4
5
6 / The Band of Angels
How Venture Capitalists Evaluate Potential Venture Opportunities
AsiaMail.com: What’s in a Name?
A Note on Pre-Money and Post-Money Valuation (A&B)
Term Sheet Negotiations for Trendsetter.com Inc
Chengwei Ventures and the hdt Investment

3.  RECOMMENDED TEXTS

Basic Texts:

a.  New Venture Creation: Entrepreneurship for the 21st Century – Jeffry A. Timmons (McGraw Hill) [JT];

b. Entrepreneur Finance: From Start Up to IPO – Eugene Wong

Other Texts:

a.  Venture Capital: The Definitive Guide for Entrepreneurs, Investors, and Practitioners – Joel Cardis, Sam Kirschner, Stan Richelson, Jason Kirschner, and Hildy Richelson (Wiley);

b.  The Money of Invention. How Venture Capital creates New Wealth – Paul A Gompers and Josh Lerner (Harvard Business School Press);

c.  The Arthur Young Guide to Raising Venture Capital – G. Steven Burrill, John J. Huntz, Jr. and Graig T. Norback (Liberty House)

d.  Valuation, Avoiding the winner’s curse – Kenneth R. Ferris, Barbara S. Pecherot Petit (Prentice Hall)

Journals

a.  Journal of Business Venturing

b.  Venture Capital Journal

4.  COURSE ASSESSMENT

Class Participation : 20%

Group Presentation : 30%

Case Exam : 50%