This class examines the economics of U.S. venture capital finance and the contract structures that are used to achieve these economics. Special attention will be paid to developing pro-forma financial models that analyze how various contract provisions affect investor and founder cash flows. Among other things, students will study how VC contract provisions are designed to protect investors from economic and voting dilution, how they allocate merger consideration in an acquisition of a VC-backed startup company, and how they can be used to incentivize subsequent investment by a company's VC investors. Students will complete several "modeling" exercises (using Microsoft Excel) throughout the semester that cover common modelling tasks expected of lawyers working in VC finance. Access to Microsoft Excel is required for this course. The course is open to Graduate School of Business and other non-law students with permission of the instructors. See Non-Law Student Registration at https://law.stanford.edu/education/courses/non-law-students/.
3 units · Law Honors/Pass/Restrd Cr/Fail
This class examines the economics of U.S. venture capital finance and the contract structures that are used to achieve these economics. Special attention will be paid to developing pro-forma financial models that analyze how various contract provisions affect investor and founder cash flows. Among other things, students will study how VC contract provisions are designed to protect investors from economic and voting dilution, how they allocate merger consideration in an acquisition of a VC-backed startup company, and how they can be used to incentivize subsequent investment by a company's VC investors. Students will complete several "modeling" exercises (using Microsoft Excel) throughout the semester that cover common modelling tasks expected of lawyers working in VC finance. Access to Microsoft Excel is required for this course. The course is open to Graduate School of Business and other non-law students with permission of the instructors. See Non-Law Student Registration at https://law.stanford.edu/education/courses/non-law-students/.
Offered in Winter 2027 at Stanford University.