BizMovieBizMovie

Lesson 7Lesson 7

Venture CapitalistVenture Capitalist

A person who invests cash in a new A person who invests cash in a new and innovative businessand innovative business

Why would a VC invest in your Why would a VC invest in your company?company?Since your company has been incorporated Since your company has been incorporated

and “gone public”, you can sell shares of and “gone public”, you can sell shares of stock. The VC hopes to invest money in stock. The VC hopes to invest money in your company and resell the shares for a your company and resell the shares for a higher price than they were purchased.higher price than they were purchased.

Raising CapitalRaising Capital

Each company will need to raise $15-Each company will need to raise $15-$30 BB to complete the design $30 BB to complete the design process.process.

You will have 15 minutes to prepare a You will have 15 minutes to prepare a pitch ( presentation to the VC pitch ( presentation to the VC convincing me to invest)convincing me to invest)

Amount earned will be based on Amount earned will be based on quality of pitch (see rubric)quality of pitch (see rubric)

Companies are encouraged to Companies are encouraged to negotiate offers with the VC.negotiate offers with the VC.

Planning Your PitchPlanning Your Pitch

Only Executive Producer and VP of Only Executive Producer and VP of Finance will make the pitchFinance will make the pitch

Qualities- confidence, eye contact, Qualities- confidence, eye contact, product knowledgeproduct knowledge

Background information- team works Background information- team works well together, movie conceptwell together, movie concept

What percentage of your company What percentage of your company are you willing to sell?are you willing to sell?

Initial CostsInitial Costs

After investor has provided capital, After investor has provided capital, determine package to be purchased determine package to be purchased and complete purchaseand complete purchase

Each team member is paid $1BB for Each team member is paid $1BB for salarysalary

Rent of $1 BB is collected from each Rent of $1 BB is collected from each company for rentcompany for rent

Company LedgerCompany Ledger

VP of Finance records transactions on VP of Finance records transactions on ledgerledger

Brings salaries and rent to teacherBrings salaries and rent to teacherVP of Finance will reconcile VP of Finance will reconcile

company’s cash and Stock company’s cash and Stock CertificatesCertificates