Summary module description:

The objective of the module is to develop students’ appreciation of the practical aspects of raising venture capital finance for a private company, working with the venture capital investor in growing the business and achieving a successful exit. The focus of the module is on venture capital and high-growth ventures from the viewpoints of both the entrepreneur or management team and of the investing institution (general partner), although private equity as a whole is covered as well as the relationship between the private equity or venture capital firm and its own investors (limited partner institutions). Extensive use will be made of case studies and a business plan project in addition to guest lectures from invited experienced practitioners.

Assessable learning outcomes:
By the end of the module it is expected that students will be able to:

  • Understand the real world processes involved ,and issues, in raising venture capital finance
  • Be aware of other sources of finance, such as business angels, government sources and bank debt.
  • Understand the current issues and challenges facing the venture capital industry and how the industry is structured
  • Be able to prepare a business plan for the purpose of raising finance for an early-stage or expansion proposition
  • Understand the investment process and how venture capital firms appraise, structure and monitor their deals
  • Be able to negotiate a term sheet and final shareholders agreement
  • Understand how the venture capital firm aims to add value to the investment
  • Be conversant with the various exit routes and how venture capital firms make a return on their investments.

Additional outcomes:
The module offers students the opportunity to work together to develop team-building and presentation skills as they discuss the case studies in groups, prepare and present a business plan and negotiate term sheets.

Outline content:

  • Sources of finance, including working capital management, bank debt, mezzanine, government initiatives (including ECFs and VCTs), business angels, venture capital and private equity
  • Structure and management of venture capital firms, including limited liability partnerships and the fund raising process
  • Trends and issues in the global and European venture capital marketplace
  • Business planning process, incl USPs, SWOT analysis, market and risk analysis, financial scenarios
  • Selecting and approaching venture capital firms, including stage and sector focus, and review of current "hot" sectors for investment. Specific issues with regard to corporate venturing and university spin-outs.
  • Venture capital investment process, including financial, commercial and technical due diligence, arriving at the equity stake, terms sheets, negotiations, structuring the deal,
  • Management buyouts, including routes to added value, leveraged deals, types of debt, structuring the buyout
  • Tax and legal issues, including the shareholder’s agreement, warranties and indemnities
  • Monitoring the investment
  • Valuation of investments in early stage companies
  • Exit routes, including IPOs and trade sales.

Global context:
The fund raising and investment processes discussed on this module have essentially global applicability.

Brief description of teaching and learning methods:
Full Time: The core theory and concepts will be presented during lectures. Small class groups will discuss various cases, drawn from the lecturer’s range of contacts with venture capital firms, business angels and entrepreneurs. Negotiation of term sheets will be practiced in class.
Guest speakers from the venture capital and private equity industry will be invited to discuss practical issues related to the topics covered on the course.

Contact hours:
  Autumn Spring Summer DL
Lectures   15    
Seminars & guest lectures   5    
Other contact (eg study visits)        
Total hours   20    
Number of essays or assignments   1 project    
Other (eg major seminar paper)        

Summative Assessment Methods:
Method Percentage
Written exam 60
Written assignment including essay 28
Oral assessment and presentation 12

Other information on summative assessment:
The oral assessment is the students’ presentation of their written coursework which is carried out in self-selected groups.

Project (40%)

Group preparation of business plan for real-life or fictitious technology or other sector focused early-stage company and presentation to judging panel of experts.
(written work: 28%, presentation 12%)

Formative assessment methods:

Penalties for late submission:
Penalties for late submission on this module are in accordance with the University policy. Please refer to page 5 of the Postgraduate Guide to Assessment for further information:

Length of examination:
2 hours closed book written examination (answer two questions from a choice of four)

Requirements for a pass:
50% weighted average mark

Reassessment arrangements:
By written examination only, as part of the overall examination arrangements for the MSc programme.

Additional Costs (specified where applicable):
1) Required text books:
2) Specialist equipment or materials:
3) Specialist clothing, footwear or headgear:
4) Printing and binding:
5) Computers and devices with a particular specification:
6) Travel, accommodation and subsistence:

Last updated: 21 December 2016

Things to do now