Syllabus
In summer semester 22/23 compact course will be taught face to face, June 7-8, 2023, 9-12h and 14-17h, IES building, room 314 and will be finalised by online test during next week.
Three use cases
Learn how investment professionals approach PE/VC investments,
You can apply the learnings to “entrepreneurship via acquisition”, and
The topics covered apply to broader corporate strategy
Lecture 1: What is Private Equity (and Venture Capital)?
Some historical perspective (or what do Crusades have to do with any of this?)
How do PE/VC funds work
Lifecycle of a fund: Institutional fundraising / asset management
VC vs. PE; What is a “Family Office”, a “Search Fund”
Lecture 2: Investment strategies & opportunity screening
How do PE firms make money?
How is VC different from PE?
PE Investment strategies and Investment criteria
Auctions vs. proprietary sourcing
Lecture 3: Role of Debt
Debt capacity (how much debt can you raise?) and leverage ratios
Cost of debt (hint: not just the interest you pay)
Alternative sources of debt – an overview
Capitalization table & liquidation preference
Lecture 4: Valuation in PE/VC Context
Price vs. Value
Value to who? Stakeholders’ perspective
Overview of basic valuation techniques: pro’s and con’s
Difference between PE and VC approach to valuation
Lecture 5: Acquisition Process
From the first contact to a Deal
Key parties to the table
Difference between an auction and negotiated transaction
Due diligence
Lecture 6: Acquisition Agreement
Transaction structure: What do you buy (assets or shares) and how do you pay (cash or shares) and how much (fixed price vs formulae)
Buying whole business vs control vs minority stake (PE vs VC)
Deal protection: Representation & Warranties and Remedies (Baskets, de minimis, caps)
Conditions precedent & Closing
Lecture 7: Monitoring & Exiting investments
Monitoring: Management vs. Board roles
Monitoring: The Good, the Bad and the Ugly
Timing the exit: determinants
Ways to exit: Trade sale, secondary LBO, IPO, Recap
Panel with Industry Practitioners
Speakers to be announced
Annotation
The objective of the course is to provide both a conceptual framework of and practical insights into private equity investing. The course design follows the logic of a typical deal going from preparation to execution to exit, looking from both strategic and operational level. Each block comprises topical seminars complemented by guest talk by and discussion with experienced professionals in a given area of focus.
Registration into this compact course is open until the first day of the course.