Unit I: Introduction 5 hours
Concept and nature of small business finance; Organizing and financing a small business; Forms of small business organization; Choosing a form of organization and its tax and other considerations; Seed, start-up and first round financing sources: financial bootstrapping, Business angel funding and first-round financing opportunities.
Unit II: Preparing and Using Financial Statements 7 hours
Obtaining and recording necessary resources for small business; Business assets, liabilities and equity; Sales, expenses and profits; Internal operating schedules; Statement of cash flows; Operating and survival break even analysis; Identifying break even drivers in revenue projections.
Unit III: Evaluating Operating and Financial Performance 7 hours
Concept and need of operating and financial performance; Operating and financial performance measures by stages of life cycle; Financial ratios; Cash burn rates and liquidity ratios; Measuring financial leverage ratios; Profitability and efficiency ratios; Industry comparable ratio analysis.
Unit IV: Managing Cash Flows 6 hours
Financial Planning throughout venture life cycle; Surviving in the short run; Short-term cash planning; Projected monthly financial statements; Cash planning from projected monthly financial statements; Conversion period ratios.
Unit V: Costs of Financial Capital 5 hours
Implicit and explicit financial capital costs; Determining the cost of debt capital; Concept and measures of investment risks; Estimation of cost of equity capital; Weighted average cost of capital; Life cycle weighted average cost of capital.
Unit VI: Creating and Recognizing Venture Value 6 hours
Concept of venture worth; Basic mechanics of valuation; Required versus surplus cash; Just-in-time equity valuation; Accounting versus equity valuation cash flows; Basic venture capital valuation method; Earning multipliers and discounted dividends.
Unit VII: Professional Venture Capital 6 hours
Concept and nature of professional venture capital; Professional venture investing cycle; Determining fund objectives and policies; Organizing new fund; Soliciting investments in new funds; Obtaining commitments for a series of capital calls; Conducting due diligence and actively investing; Arranging harvests or liquidation; Distributing cash and securities proceeds.
Unit VIII: Other Financing Alternatives and Financial Distress 6 hours
Facilitators, consultants and intermediaries; Commercial and venture bank lending; Credit cards; Government financing programs; Receivables lending and factoring; Debt, debt substitutes and direct offerings; Concept and nature of financial distress; Resolving financial distress.