06 18 15 Class Slides 1
Topics: Venture capital, Cash flow, Net present value, Internal rate of return, Private equity, Investment / Pages: 9 (1304 words) / Published: Jun 17th, 2015

Class #2
Administrative Details & Upcoming Assignments
• Please see me if you weren’t in the first class
• Please remember to submit your study question responses
• Please prepare the Technical Data Corp case

Today’s Schedule
• Beijing Sammies case discussion
• Bio-break
• Presentation on the approach Venture Capitalists use
• Beijing Sammies: How to contemplate a possible investment
1
Copyright 2015, Gregory L. Stoller

Lessons from Beijing Sammies - I
• People
a) Know your own strengths and weaknesses; be honest & humble
b) Success is interconnected with your internal/external people skills
c) Partnerships are like marriages and have ups and downs
d) Relationship management is a marathon, not a sprint
• Opportunity
a) Business planning is key; don’t use “ready, fire, aim” strategy
b) Isolate business decisions from international expansion decisions
c) Build diversification into your business strategy & experiment
d) Identify a niche and then focus your energies on expanding it…
e) … you don’t need to be “all things to all people” to be successful
2
Copyright 2015, Gregory L. Stoller

Lessons from Beijing Sammies - II
• Context
a) Know your industry inside-and-out (Porter’s 5 Forces analysis)
b) Know your industry’s value chain and products
c) It’s not necessarily what you sell, but also how you deliver it
d) Understand cultural differences and broadcast to ALL stakeholders
e) Customize offerings to make customers feel as if they’re unique
• Deal
a) From whom you raise money is more important than the funding
b) If at first you don’t succeed…
c) Ideas are everywhere, execution is elusive

3
Copyright 2015, Gregory L. Stoller

Background Survey
• Prior to this class, have you:
(1) Ever taken a course in Entrepreneurship or Starting New Ventures, etc.?
(2) Taken a Finance course?
(3) Do you have a comfortable, working knowledge of the following
Finance and Accounting Statements:
a) NPV
b) IRR
c) Free Cash Flow
d) Discounted Cash Flow Valuation Method
e) Venture

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