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English
John Wiley & Sons Inc
10 March 2021
An invaluable resource for current and aspiring technology investors, Venture Capital and the Finance of Innovation provides an in-depth understanding of the tools and models needed to succeed in this competitive and highly fluid business environment. Building on a comprehensive introduction to fundamental financial and investment principles, the text guides the reader toward a robust skill set using enterprise valuation and preferred stock valuation models, risk and reward, strategic finance, and other concepts central to any venture capital and growth equity investment.

Two features of the book stand out from other sources on the subject. First, it pays special attention to the enterprise valuation methodology for high-growth companies. What drives the value of a company that has little physical assets, losing money now but has a small chance of achieving great success in several years? How do you create estimates for sales, profit and return on capital when little data is available? The book answers these questions using a discounted cash flow model that is tailor-made for technology companies (DCF.xlsx downloadable from the instructor website), and the comparables model. Second, it highlights the most valuation-relevant feature of VC term sheets, namely the use of convertible preferred stock. The book shows the reader how to use a user-friendly and automated valuation model of VC preferred stock (available at www.vcvtools.com) to value various types of preferred stock and to visualize how term sheets split the values of the firm between entrepreneurs and VCs.

Accessible, comprehensive, and assuming only basic knowledge of venture capital, this text offers essential guidance for successful VC and growth equity investing in any market.

By:   , ,
Imprint:   John Wiley & Sons Inc
Country of Publication:   United States
Edition:   3rd edition
Dimensions:   Height: 252mm,  Width: 203mm,  Spine: 20mm
Weight:   862g
ISBN:   9781119490111
ISBN 10:   1119490111
Pages:   496
Publication Date:  
Audience:   College/higher education ,  Primary
Format:   Paperback
Publisher's Status:   Active

Reviews for Venture Capital and the Finance of Innovation

"""This third edition of Venture Capital and the Finance of Innovation is an excellent successor to Andrew Metrick and Ayako Yasuda's previous edition, which was the gold standard in the area. The book provides many unique features including valuation tools for high-growth firms, and option-pricing based tools for valuing the preferred stock used in venture capital. I highly recommend it to students and scholars alike.""— Franklin Allen, Professor of Finance and Economics, Imperial College London ""Metrick and Yasuda continue to provide the most comprehensive reference for venture capital. Their treatment of valuation, contracts, and returns is both rigorous and accessible. Every student of the industry should have this book on their shelves.""—Paul Gompers, Eugene Holman Professor of Business Administration, Harvard Business School ""A new and improved version of my go to book for students, GPs and LPs to learn and understand the fundamentals and nuances of VC investing.""—Steven N. Kaplan, Neubauer Family Professor of Entrepreneurship and Finance, University of Chicago Booth School of Business “If you want to understand the venture capital industry, this is the book.”-Jay R. Ritter, Joseph B. Cordell Eminent Scholar, Warrington College of Business, University of Florida"


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