Entrepreneurial Finance
Module WI000158
This module handbook serves to describe contents, learning outcome, methods and examination type as well as linking to current dates for courses and module examination in the respective sections.
Module version of SS 2015 (current)
There are historic module descriptions of this module. A module description is valid until replaced by a newer one.
Whether the module’s courses are offered during a specific semester is listed in the section Courses, Learning and Teaching Methods and Literature below.
| available module versions | |
|---|---|
| SS 2015 | WS 2011/2 |
Basic Information
WI000158 is a semester module in English language at Bachelor’s level which is offered in summer semester.
This module description is valid to WS 2016/7.
| Total workload | Contact hours | Credits (ECTS) |
|---|---|---|
| 180 h | 60 h | 6 CP |
Content, Learning Outcome and Preconditions
Content
The course is divided in three parts: First, the entrepreneurial process and characteristics of successful entrepreneurs are analyzed. Special attention is put on sources of financing and students get an overview of different sources of funding available to young companies.
Second, the business model of private equity firms is analyzed and the refinancing and investment process of a private equity firm will be discussed intensively. The refinancing process is divided into three parts: fundraising, investor relations and the return of funds. The investment process mainly covers the following activities of a private equity firm: sourcing, screening, contracting, venture management and exiting.
Third, the course focuses on valuation of entrepreneurial ventures. The specific requirements for the valuation of entrepreneurial firms are identified. Standard valuation methods are then analyzed as to their applicability in different contexts. Valuation methods include the discounted cash flow approach, multiple approach and real option valuation. In addition, context-specific approaches to new venture valuation are considered.
Second, the business model of private equity firms is analyzed and the refinancing and investment process of a private equity firm will be discussed intensively. The refinancing process is divided into three parts: fundraising, investor relations and the return of funds. The investment process mainly covers the following activities of a private equity firm: sourcing, screening, contracting, venture management and exiting.
Third, the course focuses on valuation of entrepreneurial ventures. The specific requirements for the valuation of entrepreneurial firms are identified. Standard valuation methods are then analyzed as to their applicability in different contexts. Valuation methods include the discounted cash flow approach, multiple approach and real option valuation. In addition, context-specific approaches to new venture valuation are considered.
Learning Outcome
At the end of the module, students will be able to understand the entrepreneurial process and the sources of financing which are relevant in different development stages of companies.
In addition, students will be able to understand the business model of private equity and venture capital firms including their special refinancing and investment process. Furthermore, students will be able to evaluate contractual terms and conditions of private equity and venture capital transactions. Finally, students will gain the skill to apply and analyze valuation methods which are suitable for entrepreneurial companies.
In addition, students will be able to understand the business model of private equity and venture capital firms including their special refinancing and investment process. Furthermore, students will be able to evaluate contractual terms and conditions of private equity and venture capital transactions. Finally, students will gain the skill to apply and analyze valuation methods which are suitable for entrepreneurial companies.
Preconditions
Sound understanding of basics in financing and investing.
Courses, Learning and Teaching Methods and Literature
Courses and Schedule
| Type | SWS | Title | Lecturer(s) | Dates | Links |
|---|---|---|---|---|---|
| VO | 4 | Entrepreneurial Finance (WI000158) |
Mon, 14:00–17:00, 1180 |
eLearning |
Learning and Teaching Methods
Lecture with integrated comprehensive exercises. The content will be taught during the lectures and students should be motivated to analyze the topics and to work on sample questions that will be discussed during the lecture.
Media
Powerpoint Slides, Whiteboard
Literature
• Achleitner, A.-K. / Nathusius, E. (2004): Venture Valuation Bewertung von Wachstumsunternehmen, Wiesbaden.
• Amis, D. / Stevenson, H. (2001): Winning Angels, London
Gompers, P./ Sahlman, W. A. (2002): Entrepreneurial Finance – A Casebook, New York.
• Scherlis, D. R. / Sahlman, W. A. (1989): A Method for Valuing High-Risk, Long-Term Investments - The "Venture Capital Method", Harvard Business School, Boston.
• Smith, J./Smith, R. (2004): Entrepreneurial Finance, 2nd Edition, Hoboken, NJ.
• Timmons, J./ Spinelli, S. (2007): New Venture Creation: Entrepreneurship for the 21st century, Boston.
• Amis, D. / Stevenson, H. (2001): Winning Angels, London
Gompers, P./ Sahlman, W. A. (2002): Entrepreneurial Finance – A Casebook, New York.
• Scherlis, D. R. / Sahlman, W. A. (1989): A Method for Valuing High-Risk, Long-Term Investments - The "Venture Capital Method", Harvard Business School, Boston.
• Smith, J./Smith, R. (2004): Entrepreneurial Finance, 2nd Edition, Hoboken, NJ.
• Timmons, J./ Spinelli, S. (2007): New Venture Creation: Entrepreneurship for the 21st century, Boston.
Module Exam
Description of exams and course work
Examination is fully based on one written exam (120 minutes). The exam proofs students' knowledge and understanding of the entrepreneurial process, the various sources of financing, the business model of Private Equity and Venture Capital firms. Furthermore, the exam tests students ability to use and critically analyze different valuation approaches. Students are allowed to use a non-programmable calculator during the exam.
Exam Repetition
There is a possibility to take the exam in the following semester.