VC Modeling Boot Camp

TheBigBambino's picture
Rank: King Kong | 1,422

So I've already done programs like Training the Street and Wall Street Prep, but what I'm looking for is a more relevant modeling boot camp for VC's.

The deals I'm doing can range from 500K - 25M Seed, Series A/B/C/D/ect. rounds. I'm looking for more practice modeling out cap tables and 5 year projected PnL and BL's given certain assumptions and crappy financials. Also exit analysis would be nice.

Anyone know of any services?

Thanks.

Comments (5)

Feb 15, 2013

Interesting question. I am unaware of any modelling services specific to VC but given an understanding of Pre/Post investments with multiple rounds and a strong foundation in traditional operating company modelling I am not sure what else there is to know. The only difference that I can think of is a greater use of probability weighting to account for failure but trying to model a VC deal (as I am sure you know and appreciate) 5 years out is not only difficult but generally futile. As far as exit analysis goes, there are only so many options:

1) equity dilution / new valuation based on new round or ability to get taken out
2) IPO
3) Sale to a strategic / another early stage financial sponsor
4) Failure

Let me know if you find anything.

Mar 13, 2013

It's a well kept secret. The cap tables found online are jokes -- too simple. The reality, especially for late-stage (Series D and E), is that these cap tables and returns analysis are filled with bells and whistles (liquidation preferences with capped participation, warrant coverages, bridges converting in the round, covenants on these bridges, cumulative dividends, anti-dilution, etc) and it gets better when the company goes through a recap. The thing is, if you're good at modelling, you'll pick the VC part quickly when you get in a VC fund. Each deal is different, so VCs are not really looking for someone who understands a cap table (that is the easy part) but someone that can turn a a complex term sheet into a dynamic model built from scratch. What you should do (what I did): Buy books about VC deal structuring to get familiar with the jargon and various concepts, and keep working on your modelling, especially your ability to build from scratch quickly and error-free.

Mar 19, 2013
Themistocles:

. What you should do (what I did): Buy books about VC deal structuring to get familiar with the jargon and various concepts, and keep working on your modelling, especially your ability to build from scratch quickly and error-free.

Any suggestions for specific books? Thanks.

Mar 13, 2013
joey joe joe shabadoo:
Themistocles:

. What you should do (what I did): Buy books about VC deal structuring to get familiar with the jargon and various concepts, and keep working on your modelling, especially your ability to build from scratch quickly and error-free.

Any suggestions for specific books? Thanks.

"Venture Capital & Private Equity - A Casebook" by Josh Lerner et al. (used at HBS. It has mostly cases and doesn't dig into details or quant aspect).

"Venture Capital and the Finance of Innovation" by Andrew Metrics (used at Wharton and is more detailed, quant-driven and thorough than the above).

Both books complement each other well.

Mar 29, 2013
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