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Formatting Fundamentals
Best formatting practices for text, numbers, and larger model construction.

Income Statement
Developing a company’s Income Statement for use in a financial model.

Return Metrics
Understanding and leveraging the primary return metrics used in venture.

Free Cash Flow
Encompassing a holistic view of the impact cash has on a company’s projections and valuation.

Capitalization Tables
Developing a capitalization table and understanding its evolution over time.

Waterfalls
An introduction to and an in-class example of a waterfall for a company that is getting acquired.

Class Times
The course will take place from 7:00 pm – 8:30 pm (CT) on Tuesdays and Thursdays. Classes will be conducted entirely through Zoom.

When the batch is run during the day, it will take place from 12:00 am – 1:30 pm (CT).

Pre-Requisite Knowledge
This course is meant for all levels. Beyond a preliminary understanding of accounting and finance, there is not a specific pre-existing knowledge set that is required. To students concerned about their level of proficiency, feel free to reach out to me to discuss directly.

Batch Sizes
A Batch will contain 10 – 15 students. Batches are constructed to ensure students in the course have a common level of understanding and will broaden other students’ networks.

Student Profile
The course’s primary goal is to develop financial skills in people currently working in venture after transitioning from a different industry. The typical student will be between Associate and Partner and have a background in a non-financial sector. There will typically be 1 – 2 analysts included in a Batch (selections are made on a case by case basis).

Batch Selection
Once a student has applied to the course through the application link above, they will remain in the active applicant pool until an appropriate Batch is found. Once a potential fit has been identified, students will be invited for a 30-minute interview so the instructor can better understand their backgrounds, motivations, and goals for the course. Assuming students are a good fit, they will be added to the Batch.

Programs / Tools Needed
Windows’ operating system offers the broadest functionality when working in Microsoft Office, so it is suggested, but any operating system will work.

Homework and Case Studies
Students will be provided with homework assignments and case studies to reinforce their understanding of the material covered in each week’s sessions. Additionally, each week 2 – 3 case studies will be provided to offer an opportunity for a comprehensive review of the topics covered in that week’s classes. Questions will be modeled after the type of situation one might encounter on the job.

Week 1: Introduction to Returns and Capitalization Tables
Students will be introduced to the return metrics most commonly used in venture with associated discussions on when these metrics will be used. Additionally, students will learn the key terms / techniques used when developing a capitalization table. Topics covered will include building an employee option pool, layering in new securities, calculating pre- and post-money valuation, and completing option pool refreshes.

Week 2: Understanding and Developing an Income Statement
Information covered will include techniques for a bottoms-up revenue build (starting at the level of contract terms and bookings), with discussions on common revenue metrics used to drive a company’s valuation. Time will also be spent discussing the concepts surrounding a company’s expenses and the key lines of expense commonly shown on the Income Statement.

Week 3: Understanding a Company’s Cash Position
Information covered will expand the class’ understanding of the Income Statement’s limitations. Net Working Capital and Capital Expenditures will be taught with a focus on calculating Free Cash Flow. There will also be consideration given to the impact these items have on valuation.

Week 4: Developing Waterfalls
Information covered will walk the class through terms used to evaluate a waterfall (e.g., liquidation preference, participation rights, cap on returns, and conversion to common equity). Once the terms are defined, students will be walked through a waterfall using multiple equity tranches with different terms.