Valuation for Startups Using Discounted Cash Flows Approach

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Description

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About this course: Discounted cash flow method means that we can find firm value by discounting future cash flows of a firm. That is, firm value is present value of cash flows a firm generates in the future. In order to understand the meaning of present value, we are going to discuss time value of money, first. That is, the value of $100 today is different from the value of $100 a year later. Then, what should be the present value of $100 that you are going to receive in 1 year? How about the value of $100 dollars that you are going to receive every year for next 10 years? How about forever? After taking this course, you are going to be able to find the present value of these types of c…

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Didn't find what you were looking for? See also: PRINCE2, PRINCE2 Foundation, PRINCE2 Practitioner, Retail (Management), and Project Management.

When you enroll for courses through Coursera you get to choose for a paid plan or for a free plan

  • Free plan: No certicification and/or audit only. You will have access to all course materials except graded items.
  • Paid plan: Commit to earning a Certificate—it's a trusted, shareable way to showcase your new skills.

About this course: Discounted cash flow method means that we can find firm value by discounting future cash flows of a firm. That is, firm value is present value of cash flows a firm generates in the future. In order to understand the meaning of present value, we are going to discuss time value of money, first. That is, the value of $100 today is different from the value of $100 a year later. Then, what should be the present value of $100 that you are going to receive in 1 year? How about the value of $100 dollars that you are going to receive every year for next 10 years? How about forever? After taking this course, you are going to be able to find the present value of these types of cash flows in the future. Unlike most of finance courses, in this course, you are going to learn how to use excel to find present value of future cash flows. In addition to the present value, you are also going to learn how to find future value given investment; interest rate given investment and future cash flows, payments given interest rates, number of periods to wait given investment and interest rate, and so on. After learning the concept and how to find the time value of money, you are going to apply this to real world examples and company valuation. After taking this course, you will be ready to make an estimate of firm value by discounting its cash flows in the future.

Who is this class for: The target audience of this Specialization includes venture capitals, angel investors, and entrepreneurs, Particularly, entrepreneurs are wondering the value of their startups and how much ownership they need to give up to raise additional capital. It is same for angel investors. They are wondering how much ownership they need to ask in return for their investment.  Venture capitals may know the value of startups better than entrepreneurs or angel investors but they need to communicate with startups how they value startups. This Specialization helps angel investors, entrepreneurs, and venture capitals understand and communicate the value of startups.

Created by:  Yonsei University
  • Taught by:  Hyun Han Shin, Professor

    School of Business
Basic Info Course 1 of 5 in the Valuation and Financial Analysis For Startups Specialization Level Beginner Language English, Subtitles: Spanish, Korean How To Pass Pass all graded assignments to complete the course. User Ratings 4.3 stars Average User Rating 4.3See what learners said Trabajo del curso

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Yonsei University Yonsei University was established in 1885 and is the oldest private university in Korea. Yonsei’s main campus is situated minutes away from the economic, political, and cultural centers of Seoul’s metropolitan downtown. Yonsei has 3,500 eminent faculty members who are conducting cutting-edge research across all academic disciplines. There are 18 graduate schools, 22 colleges and 133 subsidiary institutions hosting a selective pool of students from around the world. Yonsei is proud of its history and reputation as a leading institution of higher education and research in Asia.

Syllabus


WEEK 1


Time Value of Money (1)



Investing money is important decision because a dollar today is worth more than a dollar in the future. In this module, you will look at several methods for calculating future value as well as present value. After this module, you can solve challenging examples with excel.


6 videos, 10 readings, 3 practice quizzes expand


  1. Leyendo: Instructions for beta test
  2. Leyendo: Link to Course Evaluation Form
  3. Video: Welcome Video
  4. Video: 1.1 Future Value
  5. Leyendo: 1.1 Slide
  6. Video: 1.2 Present Value
  7. Leyendo: 1.2 Slide
  8. Leyendo: Quarterly Compounding
  9. Leyendo: Continuous Compounding
  10. Cuestionario de práctica: Practice Question 1-1
  11. Video: 1.3 Present Value of Multiple Cash Flows
  12. Leyendo: 1.3 Slide
  13. Video: 1.4 NPV of Multiple Cash Flows
  14. Leyendo: 1.4 Slide
  15. Cuestionario de práctica: Practice Question 1-2
  16. Video: 1.5 Present Value of Annuity
  17. Leyendo: 1.5 Slide
  18. Cuestionario de práctica: Practice Question 1-3
  19. Leyendo: Excel Template
  20. Cuadro de aviso de la discusión: Introduce yourself

Graded: Week 1

WEEK 2


Time Value of Money (2)
In this module, you will focus on how to estimate number of periods, (annual) payment, and interest rate with excel. Furthermore, you will be able to predict the value a stream of cash flows. After this module, you can solve challenging examples with excel.


4 videos, 4 readings, 2 practice quizzes expand


  1. Video: 2.1 Present Value of Perpetuity
  2. Leyendo: 2.1 Slide
  3. Video: 2.2 PMT
  4. Leyendo: 2.2 Slide
  5. Cuestionario de práctica: Practice Question 2-1
  6. Video: 2.3 Number of Periods
  7. Leyendo: 2.3 Slide
  8. Video: 2.4 Rate
  9. Leyendo: 2.4 Slide
  10. Cuestionario de práctica: Practice Question 2-2
  11. Cuadro de aviso de la discusión: Rules of Thumb

Graded: Week 2

WEEK 3


Discounted Cash Flow (DCF) Approach (1)
Using the method explained last two weeks, you will execute it in real world. In detail, you can calculate bond valuation and enterprise value.


3 videos, 4 readings, 2 practice quizzes expand


  1. Video: 3.1 Bond Valuation
  2. Leyendo: 3.1 Slide
  3. Video: 3.2 Yield to Maturity
  4. Leyendo: 3.2 Slide
  5. Cuestionario de práctica: Practice Question 3-1
  6. Video: 3.3 Enterprise Value
  7. Leyendo: 3.3 Slide
  8. Leyendo: Excel Template
  9. Cuestionario de práctica: Practice Question 3-2

Graded: Week 3

WEEK 4


Discounted Cash Flow (DCF) Approach (2)
You can forecast the firm's free cash flow and wrap up this course with review lecture.


2 videos, 2 readings expand


  1. Video: 4.1 Stock Price
  2. Leyendo: 4.1 Slide
  3. Video: 4.2 Review
  4. Leyendo: 4.2 Slide

Graded: Final Quiz
Graded: Minicase Quiz
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