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Taught by: Oren Fuerst
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For the valuation of publicly traded companies, the market price of similar companies can provide a reference point. The valuation of private companies, and particularly early-stage technology companies or projects, is more complicated. In this e-seminar, Professor Fuerst of Columbia Business School discusses the main methods of valuation and highlights some of the adjustments that are typically necessary for technology-related companies. Using case studies, the e-seminar features a step-by-step approach to illustrate valuation methods and includes financial problems for students to solve online.
The concepts and techniques explored in this e-seminar include the basic multiples method; the venture-capital method based on multiples; methods for discounting cash flow, including the adjusted-residual-income model; the relevance of different types of investors on valuations; and the impact that the discount rate has on the estimated value of a private company. Financial problems, supported by spreadsheet data, are presented to demonstrate these concepts and methods.
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| 3-5 hours |
| Anytime |
| Not-for-Credit |
| None |
| None |
| FREE
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Note: Columbia students, faculty, staff, and alumni will need to use their University Network ID (UNI) to access e-seminars.
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E-Seminar Objectives | Outline | Instructor's Background | Recommended Reading | Technical Requirements
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- Gain an overview of the methods commonly used to value companies.
- Understand how venture capitalists adapt these methods to value start-up companies or technology projects.
- Learn key financial terminology used in the venture-capital industry.
- Practice calculating a company's value by modifying different parameters.
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1. Introduction
2. The Multiples Method
3. The Venture-Capital Method
4. Methods for Discounting Cash Flows
5. Value to Different Investors
6. The Discount Rate Used by Venture Capitalists
7. Conclusion
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Professor Oren Fuerst lectures at Columbia Business School, where he is
codirector of the Technology and Internet Valuation Executive Program
and lectures on the topic of Global Valuation in the MBA program. He has
more than 15 years of involvement in capital markets and the development of
technology ventures. He is the managing director of Strategic Models
LLC, a strategic advisory group that handles all aspects of venture development
and venture-capital investments in technology and health-care sectors
worldwide.
Dr. Fuerst was previously on the faculty of Yale University's School of
Management (specializing in Global Management and Valuation) and worked
in
the capital-markets advisory group of KPMG. He has been a feature
columnist
for leading financial publications, including the Financial Times. He is
coauthor, with Uri Geiger, of From Concept to Wall Street: A Complete
Guide to Entrepreneurship and Venture Capital (Prentice Hall 2002)
and
Startups and Venture Capital (Tel Aviv University 2001).
Dr. Fuerst has degrees in economics and accounting (Dual Magna Cum
Laude)
from Tel Aviv University, and his master's and Ph.D. are from Columbia
Business School; his dissertation topic was global securities offerings.
Professor Fuerst has served as a commander in the elite technology unit
of
the Israel Defense Forces (IDF).
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Fuerst, Oren, and Uri Geiger. From Concept to Wall Street: A Complete Guide to Entrepreneurship and Venture Capital. Upper Saddle River, N.J.: Financial Times Prentice Hall, 2002.
An extensive reading list is included in the e-seminar.
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You will need to use a computer with Internet access to complete this course. We recommend the following minimum
configurations:
IBM-COMPATIBLE PC
Windows 95, 98, 2000, XP, or NT
64 MB of RAM (128 recommended)
Monitor: 800x600 resolution recommended
Connection: Internet service and 56K modem minimum
Browser: Internet Explorer 4 or above (Internet Explorer 5 strongly recommended) or Netscape 4.7 or above
Sound Card (if you can hear audio you have a sound card)
Plug-ins: RealPlayer 7 or later; Flash Player 5 or later; Acrobat Reader 5 or later
(all plug-ins are free)
MACINTOSH
MAC OS 8.6 or higher
64 MB of RAM (128 recommended)
Monitor: 800x600 resolution recommended
Connection: Internet service and 56K modem minimum
Browser: Internet Explorer 5 or above or Netscape 4.7 or above
Sound Card (if you can hear audio you have a sound card)
Plug-ins: RealPlayer 7 or later; Flash Player 5 or later; Acrobat Reader 5 or later
(all plug-ins are free)
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