Entrepreneurial Finance Problem Set

Ramana  Nanda; William A. Sahlman; Robert  White

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Exercise | August 2016 (Revised February 2018)

Entrepreneurial Finance Problem Set

by Ramana Nanda, William A. Sahlman and Robert White

Language: English

Format: Print

11 pages

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Citation:

Nanda, Ramana, William A. Sahlman, and Robert White. "Entrepreneurial Finance Problem Set." Harvard Business School Exercise 817-037, August 2016. (Revised February 2018.)

About the Authors

Ramana Nanda

Sarofim-Rock Professor of Business Administration

Entrepreneurial Management

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William A. Sahlman

Baker Foundation Professor, Dimitri V. D'Arbeloff - MBA Class of 1955 Professor of Business Administration, Emeritus

Entrepreneurial Management

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View Publications »

Robert F. White

Senior Lecturer of Business Administration

Entrepreneurial Management

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Case | HBS Case Collection | September 2016 (Revised April 2018)

Western Technology Investment

Ramana Nanda, William A. Sahlman, Nicole Keller, Ramana Nanda, William A. Sahlman and Nicole Keller

Based in Portola Valley, California, Western Technology Investment (WTI) specialized in a hybrid form of debt and equity financing for early-stage companies. Like traditional venture capital and private equity firms, WTI raised funds from institutional investors and evaluated deals. However, instead of making initial investments in the form of equity, WTI focused primarily on lending money to start-ups, charging them interest and receiving warrants that could later be converted to stock in the case of a liquidity event. Most initial investments—usually in the range of $3–$5 million—were made in tandem with or following a company’s early rounds of venture capital equity financing. In addition, like more traditional venture capital investors, WTI hoped to participate in follow-on debt and equity investments in its successful portfolio companies.

Keywords: entrepreneurial finance; venture capital; entrepreneurship; finance; Equity; Finance; Venture Capital; Entrepreneurship; Financing and Loans; California;

Citation:
Nanda, Ramana, William A. Sahlman, and Nicole Keller. "Western Technology Investment." Harvard Business School Case 817-019, September 2016. (Revised April 2018.) View Details

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Case | HBS Case Collection | September 2016 (Revised April 2018)

Western Technology Investment

Ramana Nanda, William A. Sahlman, Nicole Keller, Ramana Nanda, William A. Sahlman and Nicole Keller

Based in Portola Valley, California, Western Technology Investment (WTI) specialized in a hybrid form of debt and equity financing for early-stage companies. Like traditional venture capital and private equity firms, WTI raised funds from institutional investors and evaluated deals. However, instead of making initial investments in the form of equity, WTI focused primarily on lending money to start-ups, charging them interest and receiving warrants that could later be converted to stock in the case of a liquidity event. Most initial investments—usually in the range of $3–$5 million—were made in tandem with or following a company’s early rounds of venture capital equity financing. In addition, like more traditional venture capital investors, WTI hoped to participate in follow-on debt and equity investments in its successful portfolio companies.

Keywords: entrepreneurial finance; venture capital; entrepreneurship; finance; Equity; Finance; Venture Capital; Entrepreneurship; Financing and Loans; California;

Citation:
Nanda, Ramana, William A. Sahlman, and Nicole Keller. "Western Technology Investment." Harvard Business School Case 817-019, September 2016. (Revised April 2018.) View Details

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Technical Note | HBS Case Collection | October 2013 (Revised April 2018)

Non-Equity Financing for Entrepreneurial Ventures

Joan Farre-Mensa, Ramana Nanda and Piyush Jain

Young, and particularly high-growth ventures often need to raise significant external finance, since their internal cash flow is usually insufficient to support the investments needed to grow. Although raising equity from venture capital or angel investors is the most well-known source of external finance for high-growth ventures, many entrepreneurs, particularly small business owners, rely on debt and other non-equity sources of capital to finance their ventures, either because equity capital is not available to them or because they want to avoid the ownership dilution and governance constraints associated with equity investments.
This note focuses on these non-equity sources of financing for entrepreneurs, paying particular attention to how the emergence of new technologies in risk assessment have expanded their availability for young firms.

Keywords: entrepreneurial finance; finance; Entrepreneurship; Finance; Financial Services Industry;

Citation:
Farre-Mensa, Joan, Ramana Nanda, and Piyush Jain. "Non-Equity Financing for Entrepreneurial Ventures." Harvard Business School Technical Note 814-005, October 2013. (Revised April 2018.) View Details

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Entrepreneurial Finance Problem Set

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