Instructor: Germain Böer
Office: 343 Management Hall
     Phone 322-2059
     e-mail address: germain.boer@owen.vanderbilt.edu
     Home page http://www.mba.vanderbilt.edu/germain.boer/boer.html
Office Hours:  By appointment (I am around most of the time)

Course Description    
This course covers finance and accounting issues relevant to entrepreneurs who plan to start or purchase a business. The course requires "hands on" work through cases and real world projects with entrepreneurs. Your instructor expects you to take initiative just like real entrepreneurs, and you are expected to actively participate in all class activities. Entrepreneurs do not produce excuses--They produce results. You will learn as much from this course as you put into it. Some of the cases we cover are long and complicated, and you will benefit from them to the extent you work through them carefully and deliberately. This course is about the pursuit of opportunities to create sustainable long-term value without regard to the resources you currently control. This course presumes no preconceived notion of what opportunity or value means. My goal is to train you to think like entrepreneurs so you can take advantage of opportunities as they present themselves.

The Internal Revenue Service has a great set of materials available for free.  You can order a cd that has many helpful resources on it for free.

Link to EdgarScan--A source for financial statement data on public companies

Assignments

October 22
    Topic: Financial Projections
    Reading: Review note on preparing pro forma financial statements, and click here for the spreadsheet used to create financial statements.
    Homework: Proforma 2   Click here to download the Proforma problems. 

October 27
    Topic: Financial Projections
    Reading: None
    Homework: Proforma 3

October 29
    Topic: Developing Revenue Projections
    Reading: A Note on Developing Revenue and Expense Estimates for New Ventures
   Homework: Prepare case Using Encapsulation Technology to Cure Diabetes.

1.      Try to develop the best estimate you can make with the available information.  You will have to make assumptions, but that is true of real life cases like this one.
2.      Use the information in the note to help you develop a sensible rationale for supporting your revenue estimate.  Note the part of your estimate that is just a guess, and also note the parts that are supported by data.

 November 3
    Topic: New Venture Financial Requirements
    Reading:
    Homework: Prepare case on Fenchel Lamp Shade company; case distributed in class. 

1.      Evaluate the short and long term aspects of the proposed financing plan.
2.      Estimate the company breakeven point.
3.      How much do you think the company is worth?
4.      Does it make sense for Michele and Steve to buy Fenchel?  Why?
5.      Would you be willing to invest in the company?  Why?

November 5
    Topic: Venture Capital
    Reading: Text, chapter 13 and read "The Economics of the Private Equity Market" You must download this from the web.
    Homework: Proforma 4 Spreadsheet with base period data. 

November 10
    Topic: Financing a New Venture
    Reading: None
    Homework: Prepare Case Hindman & Co., p. 491  Spreadsheet with cash analysis for Hindman

1.      When will the company run out of cash?
2.      Where does Hindman want to take the company?
3.      What are the financial implications of his strategy?

November 12
    Topic: Structuring Deals  Spreadsheet with deal structure example  Spreadsheet with Source Hope Pharama sale
    Reading: Text, chapters 14 and 15
    Homework:

November 17, 2003
   Topic: The Development of Securities Markets in the U.S.
   Speaker: John Burch

November 19, 2003
   Topic: Using the Securities Markets to Raise Capital
   Speaker: John Burch

Thanksgiving Break

December 1
    Topic: Going Public--CPA's View
    Reading: The Survival Guide to IPOs available from http://www.bowne.com/ipoguide
    Speaker:  Randy Laszewski, Partner with KPMG

December 8
    Topic: Financing New Ventures
    Reading: None
    Homework: Prepare case on Bridge Capital Investors, Inc., p. 519  Spreadsheet with some analyses of Bridge.
        1.  Work in the assigned teams to prepare for this case.  Your teacher will give you your team assignments before class.
        2.  Come to class ready to do your negotiations.

December 10
   Topic: Cash Management     
    Reading: None
    Homework: None
    Spreadsheet for different growth rates
    Spreadsheet for different credit and payable terms
    Power Point slides used in class

Final Exam from Fall 2002
Spreadsheet that will be used on Final Exam for Fall 2003.  There will be questions about this spreadsheet on the final exam.

Course Grade