available as an in-house course 
                                                                                                                          
                           
Course Overview

This course provides a comprehensive review of the different aspects of venture capital investment and the venture capital industry and the world of management buy-outs.

It examines how venture capitalists decide on which businesses to invest in, the different processes which they may deploy in terms of their participation in the financing of the companies in which they invest, the procedures involved in making the investment and the methods in which they might recover their investment at a later date.
It also provides a detailed study of current developments in private equity investment and the venture capital industry in Europe.
The seminar covers management buy-outs and, after an overview of the history and development of MBOs (including the latest trends in the format of deals), the pricing and structure of the transaction are covered as well as the corporate financial instruments that are used (such as mezzanine finance, high yield instruments and ratchets).
Legal aspects will also be addressed and focus is placed on public to private deals (including the relevance for them of the Takeover Code).


Delegates will be required to bring a laptop with a CD-Rom.

Course Content

Day One

 Introduction
What is venture capital?
The history of venture capital in the UK and Europe
Venture capital investment - successes and failures
A global perspective on venture capital

 Investment Theory
Entry valuation
The IRR model
Alternative techniques

 Venture Capital Firm Structure
Closed and open ended funds
UK venture capital trusts
VC prospectuses
Corporate venturing
Role of bank debt
Investment strategies
The relationship between the limited and the general partner

 The Selection Process
How the venture capitalists think
Winners and losers

 Venture Capital Intelligence
Investees: technology / life science companies
Management buy-outs
The business plan
Venture capital marketplaces

 The Investment Process
Due diligence
The offer letter
The investment agreement
Accountancy and tax issues
Venture capital participation in management
Further stage funding
Monitoring the investment

 Venture Capital Exits
Best practices for VC funded companies
Exit alternatives: flotation, trade sale, MBO, second round buyout
Evidence from VC markets worldwide
How to make a successful exit (including the role of lock-ins and other incentive measures)
What makes a successful VC investment?


Day Two

 Background and Reasons for Development
History to date
Different types of transaction and differing structures

 Achieving a Successful Buy-out

 Pricing an MBO
Valuation of target company
Debt considerations
Use of P/E ratios
Venture capitalists’ IRR
Envy factors

 Structure of an MBO
Senior debt
Mezzanine finance
Institutional equity
Vendor notes
Management equity
Ratchets

 Legal Considerations
Initiating the MBO
The acquisition
The equity investment and loan arrangements
Financial assistance

 Public to Private Deals

 Exit Routes
Trade sales
Flotations
Share buy-backs
Second round buy-outs