The venture opportunity screen section 2. 6 and the Appendix will be applied in one of the Student Group case discussions, and the business plan will also come back. Exercise: mint-case Learning’s. Com Chapter 3 Organizing and financing the new venture Read the business organizational forms (do not learn) understand the examples of seed and startup financing Only read section 3. 1 and 3. 5. Some of these aspects are also dealt with by a Student Group Presentation. Exercise: none Chapter 4 Measuring financial performance understand all the key terms and summary! AS example has all the information
Accounting is essential, especially for entrepreneurs, so there is no getting around this. Section 4. 2 to 4. 5 explain basic financial accounting issues. We use in this course the annual accounts of Marriott as a basic. Apply these accounts to this section of the book and also relate this section to the FIRS Framework that forms part of the Course materials. From section 4. 6, do not learn all variants on break-even analysis by heart, but do understand the basic principle and how to apply It for what kind of decisions. Exercises: 8,9 and 10 and mint-case Jean and Larry Frozen Yogurt Company.
Chapter 5 Evaluating financial performance understand ratios, understand operating cycle Financial statement analysis Is Important. Understand the concepts, such as cash burn rates, conversation ratios and leverage, and how you can measure them. The rations of 5. 6 are especially Important to outside Investors. Exercises: 3,4,5,6 and mall-case Chanticleers 6 Financial planning short term and long term understand sales forecasting accuracy and life cycle stages understand the need for monthly cash flow statements Be aware that cash budgeting and projecting monthly statements requires a good dead of where your company is going to.
Types and costs of financial capital Understand cost of debt capital, risk free interest rate, cost of equity, WAC and pollutant chapter: study completely. Note that equity does have a capital cost- it is not free! Don’t worry too much about the math in 7. 4, but do remember that more risk requires a higher return. Note that on page 247 the dotted line should be White and the continuous black line should be Lotto. Exercises: 1,2,11,12 and mint-case Alpha Chapter 8 Securities law fundamentals
Skip completely. Chapter 9 Valuing early stage ventures In the end, it all comes down to valuing your venture: whether you want additional finance, or sell it, or go public. Skip 9. 4 and 9. 5, as well as the learning supplement. Exercises: Chapter 10 Venture capital valuation methods Read chapter and understand scenario methods Don’t be fooled by the sometimes complex formulas used in this chapter.
