Venture Capital

Study Course Description

Course Description Statuss:Approved

Course Description Version:7.00

Study Course Accepted:19.03.2024 08:11:42

Study Course Information
Course Code:		SBUEK_189		LQF level:		Level 6
Credit Points:		4.00		ECTS:		6.00
Branch of Science:		Economics; Other economic and management sub-sectors		Target Audience:		Business Management
Study Course Supervisor
Course Supervisor:		Līga Sileniece
Study Course Implementer
Structural Unit:		Faculty of Social Sciences
The Head of Structural Unit:
Contacts:		Dzirciema street 16, Rīga, szfrsu[pnkts]lv
Study Course Planning
Full-Time - Semester No.1
Lectures (count)		8	Lecture Length (academic hours)		2	Total Contact Hours of Lectures		16
Classes (count)		12	Class Length (academic hours)		2	Total Contact Hours of Classes		24
Total Contact Hours								40
Part-Time - Semester No.1
Lectures (count)		6	Lecture Length (academic hours)		2	Total Contact Hours of Lectures		12
Classes (count)		8	Class Length (academic hours)		2	Total Contact Hours of Classes		16
Total Contact Hours								28
Study course description
Preliminary Knowledge:
Basics of economics and finance, minor exposure to innovation-based companies and law background is advised.
Objective:
The course provides and introductory insight into the legal, financial and organisation aspects of innovation-driven companies, which exist in close relationship with venture capital industry and finance through risk capital. The students get introduced to the concepts of intellectual property and its market value, raising capital, investment funds, specific traits of venture capital-backed businesses, as well as means of intellectual property protection. It attempts to explain the rationale behind modern company valuations (why are some ventures valued billions without generating any cash anyway?), venture capital investment into early stage/start-up businesses and emphasizes the modern shift towards viewing the intellectual property assets as the major drivers for company’s value. The course is focused on offering practical knowledge on VC and urges active student participation throughout all sessions.
Topic Layout (Full-Time)
No.	Topic			Type of Implementation		Number	Venue
1	Introduction into concepts of venture capital (VC), serial entrepreneurship and private equity. Overview of business types, venture industry and actors involved with a specific focus on venture funds and their functioning logic. General insight into history of private equity, the structure of VC industry, main actors involved and why do we talk about it in the first place.			Lectures		1.00	auditorium
2	Types and sources of capital. Intellectual property as an asset in the VC-related businesses. IP, its forms and strategies for protection, major risks and methods of its monetisation.			Lectures		1.00	auditorium
3	Logic, structure and behaviour of venture capital funds . Risk capital investment criteria and evaluation process. How is innovation used to attract capital?			Lectures		1.00	auditorium
4	VC investment landscape, pipeline and regulation. Logic of valuations.			Lectures		1.00	auditorium
5	Steps of raising VC money. Deal structuring.			Classes		1.00	auditorium
6	Intro into IP/KBC and its growing significance.			Lectures		1.00	auditorium
				Classes		1.00	auditorium
7	Venture capital and KBC – why is it a big deal?			Lectures		1.00	auditorium
				Classes		1.00	auditorium
8	IP-related risks and challenges.			Lectures		1.00	auditorium
9	Types and patterns of IP ownership.			Lectures		1.00	auditorium
				Classes		1.00	auditorium
10	Science behind running a venture-backed company.			Classes		1.00	auditorium
11	Why valuations matter and how do they come about?			Classes		1.00	auditorium
12	Why valuations matter and how do they come about? (part 2)			Classes		1.00	auditorium
13	How do you structure a deal?			Classes		2.00	auditorium
14	Founder’s risks, tips and tricks of running a VC backed business.			Classes		1.00	auditorium
15	Case studies and trends (student presentations).			Classes		2.00	auditorium
Topic Layout (Part-Time)
No.	Topic			Type of Implementation		Number	Venue
1	Introduction into concepts of venture capital (VC), serial entrepreneurship and private equity. Overview of business types, venture industry and actors involved with a specific focus on venture funds and their functioning logic. General insight into history of private equity, the structure of VC industry, main actors involved and why do we talk about it in the first place.			Lectures		1.00	auditorium
2	Types and sources of capital. Intellectual property as an asset in the VC-related businesses. IP, its forms and strategies for protection, major risks and methods of its monetisation.			Lectures		1.00	auditorium
3	Logic, structure and behaviour of venture capital funds . Risk capital investment criteria and evaluation process. How is innovation used to attract capital?			Lectures		0.50	auditorium
4	VC investment landscape, pipeline and regulation. Logic of valuations.			Lectures		0.50	auditorium
5	Steps of raising VC money. Deal structuring.			Classes		1.00	auditorium
6	Intro into IP/KBC and its growing significance.			Lectures		0.50	auditorium
				Classes		0.50	auditorium
7	Venture capital and KBC – why is it a big deal?			Lectures		0.50	auditorium
				Classes		0.50	auditorium
8	IP-related risks and challenges.			Lectures		1.00	auditorium
9	Types and patterns of IP ownership.			Lectures		1.00	auditorium
				Classes		1.00	auditorium
10	Science behind running a venture-backed company.			Classes		1.00	auditorium
11	Why valuations matter and how do they come about?			Classes		0.50	auditorium
12	Why valuations matter and how do they come about? (part 2)			Classes		0.50	auditorium
13	How do you structure a deal?			Classes		1.00	auditorium
14	Founder’s risks, tips and tricks of running a VC backed business.			Classes		1.00	auditorium
15	Case studies and trends (student presentations).			Classes		1.00	auditorium
Assessment
Unaided Work:
Home readings, case studies, group presentations. In order to evaluate the quality of the study course as a whole, the student must fill out the study course evaluation questionnaire on the Student Portal.
Assessment Criteria:
1. In-class activity – 20%. Submissions: 4 summary reports to be submitted throughout the course, each 1 – 3 pages. 2. Case study analysis and Presentation (both text and verbal delivery) – 40% 3. Exam – 40%. Two-part exam: In-class group project presentation, take-home exam.
Final Examination (Full-Time):		Exam (Written)
Final Examination (Part-Time):		Exam (Written)
Learning Outcomes
Knowledge:		Understanding the rationale behind venture capital-backed companies; Differentiating between types of capital being invested; Being able to independently assess cases and development stages of venture-backed companies; Having a basic understanding of the concept of valuation of innovation-backed ventures; Differentiating between basic types of intellectual property assets and their effect on company’s investment attractiveness.
Skills:		Being able to build, structure and present research findings in analysing investment cases during group presentations; Being able to conduct independent research; Learning how to understand and conduct basic valuation of innovation-backed buisnesses and intellectual property assets.
Competencies:		Ability to navigate the industry of innovation-driven businesses, understing their functioning logic, being fit to evaluate basic investment opportunities and potential impact intangible assets bring to an IP-backed business. In addition, students are expected to gain basic understanding on IP-related risks, protection mechanisms.
Bibliography
No.	Reference
Required Reading
1	Abdallah, Wagdy M. and Murtuza, Athar. "Transfer Pricing Strategies of Intangible Assets, E-Commerce and International Taxation of Multinationals", in: International Tax Journal. Spring 2006. (Available from: HeinOnline)
2	Epstein, Richard A., Ben-Shahar, Omri and Masur, Jonathan S. "The Licensing of Intellectual Property", in: The University of Chicago Law Review. Vol. 78, No. 1, Winter 2011. (Available from: JSTOR)
3	"IP Based Financing of Innovative Firms", in: Enquiries Into Intellectual Property’s Economic Impact. 2015.
4	Morhman, Joel W. "Capitalizing on Intellectual Property. An Introduction to Licensing", in: The Brief. Winter 2009. (Available from: HeinOnline)
5	Simic, Marija. Investment criteria set by venture capitalists.
Additional Reading
1	EU Accounting Rule 6: Intangible Assets. (Available from: ec.europa.eu)
2	Financing Innovative firms through venture capital, pages 1-14.
3	Hirschman, Albert O. and Rothschild, Michael. "The Changing Tolerance for Income Inequality in the Course of Economic Development”, in: The Quarterly Journal of Economics, Vol. 87, No. 4, Nov., 1973, pp. 544-566
4	International Accounting Standard 38, Intangible Assets. (Available from: ex.europa.eu)
5	Launching a new product: Freedom to operate, via: WIPO.
6	Regulation (EU) No 345/2013 on Venture capital funds.
7	Sources of Financing: Debt and Equity. pages 466-476
8	What is intellectual property by WIPO?
Other Information Sources
1	IP-rimer: A Basic Explanation of Intellectual Property.
2	What Founders Need to Know: You Were Funded for a Liquidity Event — Start Looking.
3	Breaking Down the Importance of Early-Stage Startup Revenue Projections.