SlidesSession 2 FMII BM 2015-17

7/24/2019 SlidesSession 2 FMII BM 2015-17

http://slidepdf.com/reader/full/slidessession-2-fmii-bm-2015-17 1/19

BM 15-17: FM II

Session 2

Uday Damodaran XLRI Jamshedpur

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Session 2:Financing Your Start-Up: Magic or Logic?




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The Dot Com Boom and Bust

Did something actually go wrong? Justify!

Why would it have happened? Who was responsible? If thesystem has to be re-designed what should be done?

Who are the various intermediaries? And what are their roles?

Could some of them gave failed in their roles?

BM 15-17: FM IISession 2




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The Dot Com Boom and Bust

Who are the various intermediaries? And what are their roles?

Venture Capitalists

Investment Banks

Sell Side Analysts

Buy Side Analysts

Portfolio Managers

Auditors

Did they fail in

discharging theirresponsibilities?Why?

BM 15-17: FM II

Session 2



India…

MSME Listing

Earlier OTCEI, India’s Nasdaq


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BM 15-17: FM II

Session 2



New Venture Financing

Text, Chapter 15


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BM 15-17: FM II

Session 2

Ud D d




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Order of raising funds

What would the first source of funds for a start-up be?

Own Funds: Why? And in what form?

And then?

BM 15-17: FM II

Session 2

Ud D d




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Own Funds

Friends, Relatives and Associates: Why? And in whatform?

And then?

BM 15-17: FM II

Session 2

Why?Information Asymmetry!

Ud D d




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Own Funds

Friends, Relatives and Associates

Angels: Why? And what skills should they possess? In

what form will they invest?

And then?

BM 15-17: FM II

Session 2

What do they look

for? What shouldyou give them?What should youhide?

Uday Damodaran



XLRI 09-11: BehFin (BM)

Session 3


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A Question From My Behavioral Finance Course

What was your answer to question 4?

Uday Damodaran

http://localhost/var/www/apps/conversion/tmp/scratch_3/Profiling%20the%20gambler09.doc

http://localhost/var/www/apps/conversion/tmp/scratch_3/Profiling%20the%20gambler09.doc



XLRI 09-11: BehFin (BM)

Session 3


10

Even more intriguing,,,

What was your answer to question 4?

PMIR: ’09 batch/ ’10 batch/ ’11 IR A&C 4/ 2/ 12

A&D 14/ 9/ 33

B&C 2/ 0/ 3

B&D 1/ 2/ 8

? & D 0/2/ 0

BM:

A&C 7/ 2/ 3

A&D 20/ 4/ 19

B&C 3/ 0/ 0

B&D 4/ 0/ 2

Exchange

A&D 5

Focus on these!

Uday Damodaran




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Own Funds


Angels: Why? And what skills should they possess? In

what form will they invest?

And then?

BM 15-17: FM II

Session 2

What do they look

for? What shouldyou give them?What should youhide?

Information Asymmetry and Ambiguity Aversion!

Uday Damodaran




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Therefore….

Better to blurt than hide?

Today’s Telegraph

BM 15-17: FM II

Session 2

Uday Damodaran

http://localhost/var/www/apps/conversion/tmp/scratch_3/Better%20to%20blurt%20out%20than%20hide.docx

http://localhost/var/www/apps/conversion/tmp/scratch_3/Better%20to%20blurt%20out%20than%20hide.docx




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Own Funds


Angels

VC First Stage: What skills should they possess? In whatform will they invest?

And then?

BM 15-17: FM II

Session 2

Uday Damodaran




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Own Funds


Angels

VC First Stage

VC Second, And Later Stages: What skills should theypossess? In what form will they invest?

And then?

BM 15-17: FM II

Session 2

Uday Damodaran




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Own Funds


Angels

VC First Stage

VC Second, And Later Stages

Mezzanine

And then?

BM 15-17: FM II

Session 2

Uday Damodaran




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Own Funds


Angels

VC First Stage

VC Second, And Later Stages

Mezzanine

IPO: ‘Paper gains turn into fungible wealth’

BM 15-17: FM II

Session 2

Uday Damodaran



IPO…

Primary Offering

Secondary Offering


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BM 15-17: FM II

Session 2

Uday Damodaran



New Venture Financing…

Read Bladelogic?

Quiz?


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BM 15-17: FM II

Session 2

Uday Damodaran



By the way…

What is a ‘unicorn’?

cbinsights.com/research-unicorn-companies

144/ $525 bn

Flipkart $15 bn

Olacabs $5 bn

Snapdeal $2.5 bn

One97 Communications $2 bn


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BM 15-17: FM II

Session 2

Contrast with theDot Com Era..These guys wantto remain private!

SlidesSession 2 FMII BM 2015-17

Documents

Transcript of SlidesSession 2 FMII BM 2015-17