Entrepreneurship in Science and Technology How Venture Capitalists Evaluate Potential Venture Opportunities 1. Summary of the case and issues that were raised The case study is about an interview, conducted to four venture capitalists from four of the most prominent VC Silicon Valley firms, Kleiner Perkins Caufield & Byers (KPCB), Menlo Ventures, Trinity Ventures and Alta Partners. These firms invest both in seed as well as in later-stage companies, which operate mostly in the information technology sector. However, each VC has developed different sector portfolio depending on the expertise of the venture capitalists, the partner network and other factors. Professor Mike Roberts and Lauren Barley a senior research associate, both from Harvard Business School, have made a series of seven questions to their interviewees to understand how they evaluate potential venture opportunities and what they look at in order to decide if they will fund them and in which way. The questions were dealing with how VC’s evaluate potential venture opportunities, how they conduct due diligence, what process id followed for the decision making, what financial analyses is performed, the role of risk in the evaluation and how they think of potential exit routes. These questions were asked individually and revealed several similarities as well as differences in the strategy and the criteria that are used for the evaluation. 1. Analysis of the case a. Prior to reading the case list your set of criteria for evaluating new venture as an opportunity There is a range of criteria relevant for a decision of financing a new venture. To construct my list for the evaluation of a new company as an opportunity I have selected to refer to t... ... middle of paper ... ...onsider the market characteristics as not important. Hoel, unlike others mentions that a good location is also an important factor for success as it helps in hiring good professionals. d. To what degree do you think that your proposed course project / venture idea should meet these criteria? I think that our course project should address a strong pain point of the market for which customers will be highly interested. The technology and the business model must create barriers for others to copy. The team and the people that we know (our network) are certainly crucial for the success of the project as at this point especially; it is our core means for the success of our goals. The market should have a good size and significant growth prospects but since our idea is dealing with high technology and social media, this is likely a criterion for which we suffice.
Every single fact concerning the business is relevant to the choice of entity decision. Not all of them are of equal importance, but they all matter to some degree. The considerations that should be in the forefront are not the sale of ownership interests to the public, or venture capital financing--these things come later (hopefully!). Instead, the initial focus should be on:
Assessing the capital structure of any firm is important for investors attempting to determine if...
In this case analysis I will first show the requirements the company had for its financing. Then I will
First is to examine each of those projects to the corporate objectives, compare and contrasting project selection criteria and justify why a project meets the selection criteria.
Thesis: Businesses deem financing necessary when they are just beginning, expanding, or recovering; Debt financing and equity financning have many advantages and disadvantages but also change the entire accounting method that is to be considered while running the business.
Important factors of a company’s outlook are its financial strength and weaknesses. These factors can be evaluated by reviewing the firm’s financial statements and using ratios to help measure a company’s liquidity, leverage, activity, profitability, and growth. Financial ratios are computed by using the information found in a company’s financial statements: primarily income statement and balance sheet. The calculations from the current year, previous years, and other companies in the industry are used as a basis to identify and ev...
Adelman, P. J., & Marks, A. M. (2010). Entrepreneurial finance. (5 ed.). Bedford, Texas: Prentice Hall.
Ochse, G. (2013, August 15). Things to think about when buying a business. Finweek, 51. Retrieved from http://web.b.ebscohost.com.ezproxy.denverlibrary.org/ehost/pdfviewer/pdfviewer?sid=c4507653-e8f4-4f58-8882-d5d970a15628%40sessionmgr110&vid=2&hid=103
Determine the profile of the investor for which this company may be a fit, relative to that potential investor’s investment strategy. Provide support for your rationale
The subject area that our project relates to the most is Physical Education because we were attempting to improve the amount fitness by educating people and giving them options of exercises and healthy meals.
Obviously, this case aims to evaluate Joanna’s analysis. Throughout the analysis, we will estimate the cost of debt, cost of equity, and cost of capital through different financial analysis models.
Rahman, S. H. (2003). Modelling of International Market Selection Process: A Qualitative Study of Successful Australian International Businesses. Qualitative Market Research: An International Journal, 6(2), 119-132.
requires a precise mix of intellectual and technical resources. Seed is the first stage of venture capital
This project experience led me to become a part of the Innovation and Entrepreneurship Development Cell (IEDC), a student association of the college. IEDC works towards encouraging students to come up with new projects and guide them in marketing the same. Having spent more than two years as the member of IEDC, I interacted with several industry experts including the founder of E-mail, Mr. Shiva Ayyadurai, Head of DST, head manager of ICICI, and professors from various foreign universities who shared their experiences and encouraged me to take up more such projects that a...
There are a number of approaches that entrepreneurs can take to secure adequate financing, seed capital, for their business ventures (Laszlo, Terjesen, & Rappai, 2007). Investments break down into two forms: debt and equity (Business Networks for Women, 2011). Debt financing is the type of financ...