Master 2022/2023

Entrepreneurship and Financial Environment

Type: Elective course (Master of Finance)

Area of studies: Finance and Credit

Delivered by: HSE Banking Institute

Where: HSE Banking Institute

When: 1 year, 3 module

Mode of studies: distance learning

Online hours: 20

Open to: students of one campus

Instructors: Elena Dimova

Master’s programme: Finance

Language: English

ECTS credits: 3

Contact hours: 8

Course Syllabus

Abstract

An entrepreneurial firm is a young, often high growth business. Such firms differentiate themselves from other forms of organizations through being more innovative, flexible, adaptable, but risky. The knowledge gained during this course will help the financial analysts understand a very specific nature of entrepreneurial finance, associated risks and opportunities, and feel more confident building valuation models and assessing the future perspectives of business ventures. In some cases we will take the viewpoint of the entrepreneur and in others the viewpoint of an investor. The course covers (in varying degree) the following aspects: understanding the performance of small firms; assessing a new venture’s financial strengths and viability; financial analysis for startups; advanced business planning analysis; what unit economics is and why it is important to track unit economics for an early stage startups to make long term financial projections; assessing the risks of a new business and applying risk management frameworks; financing requirements of companies at different stages of the life cycle; sources of financing the small businesses. The course also focuses on the major challenges to venture capital valuation and performance measurement. Students will learn what investors look for in a startup, how to find the value of founder’s ownership before and after additional funding, how to read financial statements and make pro-forma statements, how to determine the financial health of a startup and estimate future earnings; alternative exit routes and their impact on value. The aim of this course is also to enable students to understand the top entrepreneurship trends and to assess the perspectives of startup firms in different industries. Practical applications will include writing a business plan for startup, building startup financial model and value a business venture. Microsoft Excel will be heavily used.

Learning Objectives

• The main objective of this course is to equip students with an integrated set of concepts and applications drawn from entrepreneurship, finance, and accounting, that will provide a higher understanding of the financial aspects of small business entrepreneurship and the financial environment in which these firms exist. The course also aims to develop practical skills and knowledge in the field of entrepreneurial finance (analysis, forecasting, valuation).

Expected Learning Outcomes

• build financial models for start-up projects and apply core startup valuation methods;
• critically evaluate the potential of a new start-up idea, perform feasibility analysis of the business venture;
• explain alternative exit routes and their impact on value.
• identify and assess the risks of a new business and apply risk management frameworks;
• identify the financing needs of an entrepreneurial firm and asses different financing/funding options;
• perform advanced business planning analysis and write a business plan;
• understand the prospects for a venture and identify the strategy it ought to adopt in order to maximize its performance;
• While each topic comes with its own learning outcomes, we list the most important ones here. After completing this module students should be able to: 1) explain the concepts of entrepreneurial finance and its difference to traditional corporate finance;
• Assess a new venture’s financial strengths and viability, calculate and track the unite economics of business.

Course Contents

• Innovative Entrepreneurs and Finance for Innovation
• Evaluating Entrepreneurial Opportunities and Business Planning
• Assessing a New Venture’s Financial Strength, Viability and Risks
• Valuing Startup Ventures

Assessment Elements

• Quizes on the Core Topics of the Course
• Final Project
  It includes three parts. Each part aims to develop practical skills and apply classroom learning in a real-world setting.

Interim Assessment

• 2022/2023 3rd module
  0.4 * Quizes on the Core Topics of the Course + 0.6 * Final Project

Bibliography

Recommended Core Bibliography

• Guo, Chao, and Wolfgang Bielefeld. Social Entrepreneurship : An Evidence-Based Approach to Creating Social Value, John Wiley & Sons, Incorporated, 2014. ProQuest Ebook Central, https://ebookcentral.proquest.com/lib/hselibrary-ebooks/detail.action?docID=1637065.
• Kuratko, D. F. (2007). Corporate Entrepreneurship. Boston: Now Publishers. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=214836

Recommended Additional Bibliography

• Michael A. Hitt, R. Duane Ireland, S. Michael Camp, & Donald L. Sexton. (2001). Strategic entrepreneurship: entrepreneurial strategies for wealth creation. Strategic Management Journal, 6‐7, 479. https://doi.org/10.1002/smj.196