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Section 001: 11:00 am - 12:15 pm TR, Bidgood Hall 367
Section 002: 12:30 pm - 1:45 pm TR, Bidgood Hall 115
New Venture Finance (MGT 481) provides students with working knowledge of financing mechanisms such as friends and family, venture capital, angel investments, and debt instruments for creating and operating a new venture; valuation methods for determining pre- and post-money; creating capitalization tables to track equity ownership assignments and investment rounds.
MGT 300 and MGT 386
see this Google doc
Three paperback (or ebooks) available at Amazon.com
Founder’s Pocket Guide: Friends and Family Funding $7.99 ($3.03)
ISBN 978-1-938162-11-4
Founder’s Pocket Guide: Startup valuation $7.99 ($3.99)
ISBN-13: 978-1938162046
ISBN-10: 1938162048
Founder’s Pocket Guide: Term sheets and preferred shares $7.99 ($3.99)
ISBN 978-1-938162-06-0
The lowdown: You can probably get through this course without these books, but I purposely chose these books because of their quality, conciseness, and price.
This course is for aspiring or active entrepreneurs who want to understand how to secure funding for their company. This course will demystify key financing concepts to give entrepreneurs and aspiring entrepreneurs a guide to secure funding. Examine the many financing options available to get your new venture funded. Learn the basics of finance, valuations, dilution and non-dilutive funding sources. Understand capital structure for new ventures, term sheets and how to negotiate them, and the differences between early-stage versus later-stage financing. Develop an understanding of how to develop winning investor pitches, who and when to pitch, how to avoid common mistakes that limit the effectiveness of the pitch, and how to ‘get to the close’.
Key questions answered within the course include:
When to raise outside capital?
What kind of investors invest by stage and where to find them?
What are your fundraising options?
What are the key components of the term sheet?
How to perform company valuations?
How to create milestones to delineate the progress of the new venture?
How to pitch to investors?
What techniques help the entrepreneur ‘get to the close’?
Student learning objectives include at a minimum the following:
Recognize and anticipate situations where entrepreneurs should raise outside capital
Identify appropriate types of investors by stage and recognize where to find them
Identify and evaluate fundraising options that are appropriate the to type and stage of development of the venture
Understand and differentiate the key components of the term sheet
Perform several different approaches to company valuations
Understand the components of an effective pitch to prospective investors
Recognize, evaluate, and select situation-appropriate techniques that help the entrepreneur ‘get to the close’ when fundraising
Professor Craig E. Armstrong, Ph.D. | Alston 155 | MGT481BAMA@gmail.com for "formal" course communications | Group.me for informal communications - quick answers and sudden announcements - I will invite you to the group by the first day of class.
I have organized this course into modules that present topics in "bite-sized" portions. A module usually covers a well-defined topic over a short period with defined objectives and graded activities. You should refer to this section of the course web site a few times a week to keep up with updates and to prepare yourself in advance for upcoming activities and assignments.
You will turn in a graded activity nearly every week of the semester beginning the week of January 31. In addition to the practice quiz, which is provided to help reinforce what you've learned after viewing the assigned readings and video, you'll have a graded assessment activity. This could be in the form of a written analysis, a brief case write-up, or an additional quiz. All assignments are due by 11:59 pm, Friday evenings. The points I've assigned to each module are intentionally set so that messing up on any one particular assessment won't crush your grade (or your soul). Ten assignments each each worth 10 points all add to 100 total points for the course.
Jan 12 Note: One of you let me know we "DO" have a spring break this year, so I updated the schedule accordingly. Thanks for letting me know! Here's a link to the UA academic calendar page.
Course Ice Breaker with Game Mechanisms (NOT Proof Eyewear)
Review syllabus, set up course January 17 (No lecture on January 19)
Financial Analysis Assessment, January 24 & 26; on Thursday, January 26 we will do a graded in-class activity using financial analysis for Autoshop and Build-A- Bear Workshop
Pro Forma Financials Assessment with Beatbox Beverages, January 31 & Feb 2; Feb 2 graded activity IN CLASS is the Financial Analysis assessment (10 points; on Bb as "financial analysis")
Working Capital Management Assessment, February 7 and Feb 9, Feb 9 in-class activity on Crimson Coffee working capital (10 points; on Bb as "Working Capital Mgt").
Overview of Sources of Financing Assessment, Feb 14 and 16, graded activity will take place on Feb 16.
Founders Assessment, Feb 21 and 23; here is our Feb 23 in-class activity (not graded), not graded; WE will do this assignment in class on Thursday, Feb 23 in teams 10 points (I'm revising this assignment this semester - Sp23; it's based in part of how founders divide the initial equity pie). Bonus reading: Crunchbase Explainer: How To Sell Your Stock Options On A Secondary Market (Crunchbase, 2/6/23)
Friends and Family Assessment, Feb 28 and March 2, Quiz 10 points (On Bb as "F&F"). Here is the pop non-quiz we discussed in class on Thursday (google doc with questions and annotations)
Early Stage Valuation In-class team assessment or QUIZ due Mar 7 and March 9, 10 points (on Bb as "Early Stage Val")
March 14-16 Spring Break
Angel Investors, March 21 and 23; In-Class Activity due March 24 by midnight, 10 points (on Bb as "Angel")
Venture Capital, March 28 and 30. In-class team assessment or QUIZ due March 30/31, 10 points (On Bb as "Venture Capital").
Cap Tables, April 4 and 6. In-class team assessment or QUIZ April 6/7, 10 points, on Bb as "Cap Tables"
Term Sheets (April 18) and Harvest, (April 20); (Quizzes will be combined - 20 points - and sent out on 4/20; due 4/21)
Search Funds April 25 and 27, QUIZ April 27/28, 10 points (on Bb as "Search Funds").
Resources you can (should) use in addition to assigned readings and activities, but not required for this course.
The pmarca blog archives
Select posts by Marc Andreessen 2007-2009; peer into the thoughts of one of the most influential entrepreneurs over the past three decades (not you, Bill G, Elon, or Pillow Guy) on a variety of topics.
US Small Business Association (SBA.gov): Financing Options for Small Businesses (45-minute course).
This self-paced training exercise is an introduction to financing options for your business. Topics include; determining your financial needs, loans, grants, venture capital, angel investors, crowd funding and other financial options available to small businesses.
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