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Private Equity & Venture Capital

  • Teacher(s):  
  • Course given in: English
  • ECTS Credits:
  • Schedule: Autumn Semester 2019-2020, 4.0h. course (weekly average)
  •  sessions
  • site web du cours course website
  • Related programmes:
    Master of Science (MSc) in Finance, Orientation Asset and Risk Management

    Master of Science (MSc) in Finance : Financial Entrepreneurship and Data Science

    Master of Science (MSc) in Finance, Orientation Corporate Finance



Private Equity is concerned with the financing of private corporations. Contemporary giants such as Google, Apple and Intel once started out as private firms with little assets and very limited personnel. Their staggering success has generated a growing interest over the years in the financing of private enterprises, where innovating ideas, aspiring to shape the future, are born. As the tech-valuation wave of the late 90-s showed, such a success is neither easy nor guaranteed. By its very nature, investment in private firms is illiquid, it is undertaken based on scarce information, its maturity is unknown, and the asymmetric information problems associated with it are acute.

At the same time, the buyout industry is concerned with the operational and financial restructuring of firms away from the pressing demands of the stock market. Multiple challenges emerge in this industry, may that be the appropriate mix of core and peripheral activities, the design of incentives, the due diligence process or the balance between bankruptcy risk and tax saving.

To travel through such a rough landscape, a private equity fund employee needs a balanced set of skills: Institutional knowledge, financial valuation skills, and real world experience. The content of the course is built around these premises.

The first two lectures lay out the institutional framework of the private equity industry, explaining the typology of PE investments, their cyclicality, the employment opportunities associated with it, and the sources of PE financing. Next we will see the details of deal structuring, the valuation of private equity investments and of the securities which are used for their financing. The intricacies of buyout deals will be the topic of three of our lectures, which will be completed by examining the corporate governance challenges in portfolio companies. Initial Public Offerings and other methods of exit from PE investments will be the subject of the penultimate lecture. Throughout, students will have the opportunity to develop their problem-solving skills using real-world case studies.


1. Introduction

2. Funding Private Equity

3. PE Valuation I

4. PE Valuation II

5. Partial Valuation I

6. Partial Valuation II

7. Midterm Exam

8. Starup Ideas

9. Real Options & PE Investments

10. Buyouts I

11. Buyouts II

12. Buyouts III

13. Initial Public Offerings

14. Private Equity Firms


The required textbooks for the course are:

  • Metrick, Andrew and Ayako Yasuda (2011), Second Edition, Venture Capital and the Finance of Innovation, Wiley, ISBN 978-0-470-45470-1.
  • Lerner, Josh, Ann Leamon and Felda Hardymon (2012): Venture Capital, Private Equity, and the Financing of Entrepreneurship, Wiley, ISBN 978-0-470-59143-7.


First attempt

Written 3h00 hours
Not allowed
Allowed with restrictions
  • Final exam format: written, 3 hours, closed book, non-programmable calculators are allowed. Students arriving late will not be granted a time extension and must finish at the same time as the rest of the students.
  • The final grade for the course is:

Grade=0.3*Graded Case Studies+0.1*Start-up idea+0.1*Firm Presentation+0.2*Mid-term Exam Grade+0.3*Final Exam Grade

The case studies, the final exam, the mid-term exam and the presentations will each be graded on a 1-6 scale. A grade 0 will be assigned for late submissions/omissions/copying or other breach of academic integrity. The final case study grade is the average across all case study grades.


Written 3h00 hours
Not allowed
Allowed with restrictions

Retake exam: Same as first attempt.

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