The “origin story” of this course is a previously offered 2-credit hour course entitled “Startups & Venture Capital.” That course introduced students to the various legal and business considerations involved in the representation of startup companies and in structuring early-stage and venture capital financing transactions. That course was structured such that the first half of the course covered “Startups,” and the second half of the course covered “Venture Capital.” We now have the opportunity to expand the scope and depth of the subject matter.
“Venture Capital” represents a full semester version of what was previously taught in half a semester. “Startups” is now offered separately, in the Fall, and similarly represents a full semester version of what was previously taught in half a semester. Each class can be taken independently, but the material does work well as a full-year integrated whole. Both classes, together, represent a 4-credit hour version (2 + 2) of what was previously limited to 2 credit hours.
This course - “Venture Capital” - covers the significant legal and business issues involved in financing startup companies. The course starts by exploring the meaning of “venture capital” itself, transitioning from there into a discussion of the mission and structure of the venture capital firm. The course then dives deeply into the architecture, structure and substance of classic venture capital preferred stock financings; this is the heart of the course. The course then takes one step back by focusing on the financing phase between company startup, on the one hand, and a classic venture capital preferred stock financing, on the other hand. Sometimes called the “seed stage,” the focus is on angel investors, accelerators, and seed deals themselves. The semester concludes with a discussion of the future of venture capital, including thoughts on crowdfunding, a growing and increasingly important component of the startup ecosystem.