Venture Capital Valuation Analysis Method

Description

Evaluating or determining the value of assets is a key business issue. This is especially important in considering an investment in a start-up or early stage company by a Venture Capitalist (VC), Angel, or Private Equity investor, as well as for entrepreneurs seeking capital - outside funding. Venture capital is typically exchanged for ownership in the enterprise, and the key to the structure of the deal is the valuation of the entrepreneur’s business.

This course will provide an in-depth presentation of the Venture Capital Method used by investors and entrepreneurs to establish the terms for fundings. The course will cover topics such as:

• Cash flow projection methods for early stage companies

• The discount rate or required rate of return

• Use these key parameters to apply the valuation method in a step-wise fashion

• The concepts of pre-money and post-money value

• Examine Refinements to the deal structure, stage financings and alternate types of securities

An example will show the calculations in detail. Practical negotiating points, a real-world perspective, are also included.

This course is brought to you by Illumeo. Illumeo, incorporated in 2009, is revolutionizing the hide-bound world of corporate learning. Illumeo works with corporate professionals and organizations of all sizes to build the skills and capabilities that help everyone be an expert at their job. Based in Silicon Valley, CA, Illumeo serves thousands of corporations and corporate professionals across Finance, Accounting, Human Resources, Sales and Marketing. The platform offers assessments, industry-benchmarked competency analyses, hundreds of expert-developed courses, collaborative tools, and the ability for companies to self-publish internal courses that promote institutional knowledge retention and dissemination. Illumeo is the place for expertise management and we are dedicated to the proposition that everyone can be an expert at their job.

What You Will Learn!

• Compile the key information needed to determine the ownership received for an investment in an early stage company.
• Determine the required rate of return (ROR) or opportunity cost of capital for such investments.
• Calculate the value of the firm’s equity at the end of the holding or investment horizon, using appropriate financial measures or metrics.
• Determine the required value of an investment in today’s dollars, based on the present or discounted value.
• Calculate the ownership share or fraction of the firm’s value that will fulfill the target ROR for the amount invested.
• Apply the concepts of pre-money and post-money value.
• Prepare analyses of alternate deal structures by applying the venture capital method – stage financings and the use of different types of ownership securities.

Who Should Attend!

• Anyone interested in Accounting, Finance and related fields.

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