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2012/2013  BA-HA_E164  The Economics of Entrepreneurial Business

English Title
The Economics of Entrepreneurial Business

Course information
Language English
Exam ECTS 7.5 ECTS
Type Elective
Level Bachelor
Duration One Quarter
Course period Autumn, First Quarter
Group A: wednesday, 13:30 17:10 36-42
15:20 17:10 35
Group B: friday, 11:40 14:25 35-36, 41-42
11:40 14:25 37, 39
11:40 14:25 38
11:40 14:25 40
Time Table Please see course schedule at e-Campus
Max. participants 60
Study board
Study Board for BSc in Economics and Business Administration
Course coordinator
  • Cristiana Parisi - Department of Operations Management
course secretary: Karin Hvidemose, kh.om@cbs.dk
Main Category of the Course
  • Financial and management accounting
Last updated on 27-09-2012
Learning objectives
At the end of the course students should be able to:
  • Understand the financial, control, and investment opportunities faced by start-ups and rapidly growing companies in different entrepreneurial settings.
  • Consider and select financing vehicles which are appropriate to securing the organizations' requirements.
  • Measure and evaluate cash flows and other relevant performance metrics.
  • Have broad comprehension of concepts, theories, models and frameworks to measure the performance of entrepreneurial firms at different life stages.
  • Be familiar with the motives behind, the use of, and the impact of different types of financial and non-financial performance measurements.
  • Be knowledgeable of the main barriers and success factors for implementing management control systems in entrepreneurial firms.
Prerequisite
Knowledge of basic finance and accounting is expected.
Examination
Individual project/home assignment
Individual project/home assignment:
Type of test Home Assignment
Marking scale 7-step scale
Second examiner No second examiner
Exam period Autumn Term
Aids Please, see the detailed regulations below
Duration Please, see the detailed regulations below
Examination
Students will be asked to analyse a case study and answer questions covering the whole course content. The case study will be made available for students during the last week of the course and students will have one week to work on the assignment. There is a strict maximum length of 10 pages (1 page is counted as 2,275 characters including spaces).

The make-up/re-exam will be held in the same way and with the same conditions as the ordinary exam.
Course content
This elective will be organized around the evolution of entrepreneurial firms emphasizing the dynamic nature of the issues confronting them. The course will highlight firms from the start-up phase through exploitation of growth opportunities to exiting, restructuring, and renewal of the firm. The course will build an understanding of the financial factors that affect entrepreneurial firms at various stages. Moreover, it will provide students with the ability to understand and implement the most relevant managerial control systems for entrepreneurial firms.

One focus of the course will be on understanding the various sources of capital for entrepreneurial firms. These sources include venture capital, leasing, commercial banks, franchising, and investment banks. The decisions of firms at various phases of their life cycle will be examined and the advantages and disadvantages of various sources of financing will be compared. Based on that analysis the course will provide hand on experience on how to develop a business plan to access the various sources of capital identified. A second focus of the course will be on developing important analytical skills. Throughout the course, analytical tools will be introduced and utilized. Financial analysis, various valuation methods, strategic performance measurement systems; and the fundamentals of accounting will be examined in the context of entrepreneurial firms. In addition, investment analysis, strategic and marketing issues will be explored.

Specific topics will include: start-up ventures; how to prepare an effective business plan; financial management of rapidly growing firms; strategic performance measures systems; financial distress; deal structuring; valuation; initial public offerings; the decision to harvest; and leverage buyouts.
Teaching methods
In order to provide a sense of the entrepreneurial process, there will be several cases on entrepreneurial firms at various life stages. Lectures will be supplemented with case discussion, outside readings, and guest speakers.
Expected literature

Textbook: (selected chapters)
 
Hisrich, R. D., Peters, M. P., and Shepherd, D. A., Entrepreneurship, McGraw Hill, Int. Edition, 8th ed.

The course book will be integrated by a selection of articles from A and B journals.

 
Suggested readings:
 
Bădulescu, D. (2010) SMEs Financing: the Extent of Need and the Responses of Different Credit Structures. Theoretical & Applied Economics, Vol. 17 Issue 7, pp. 25-36.
Campbell, D., Datar, S.M. and Sandino, T. (2009) Organizational Design and Control across Multiple Markets: The Case of Franchising in the Convenience Store Industry. Accounting Review, Vol. 84 Issue 6, pp. 1749-1779.
De Clercq, D., Fried, V. H., Lehtonen, O. and Sapienza, H.J. (2006) An Entrepreneur's Guide to the Venture Capital Galaxy. Academy of Management Perspectives, Vol. 20 Issue 3, pp. 90-112.
De Mattos, C., Salciuviene, L., Auruskeviciene, V. and Thomas, S. (2009) Investigating the importance of matching expectations of contributions to SMEs' international strategic alliance formation. Economics & Management, pp. 375-380.
Dietsch, M. and Petey, J. (2002) The credit risk in SME loans portfolios: Modeling issues, pricing, and capital requirements. Journal of Banking & Finance, Vol. 26 Issue 2/3, pp. 303-323.
Duh, M., Belak, J., Milfelner, Borut. (2010) Core Values, Culture and Ethical Climate as Constitutional Elements of Ethical Behaviour: Exploring Differences Between Family and Non-Family Enterprises. Journal of Business Ethics, Vol. 97 Issue 3, pp. 473-489.
Galbraith, C.S., Rodriguez, C.L. and Denoble, A.F. (2008) SME Competitive Strategy and Location Behavior: An Exploratory Study of High-Technology Manufacturing. Journal of Small Business Management, Vol. 46 Issue 2, pp. 183-202.
Harney, B. and Dundon, T. (2006) Capturing complexity: developing an integrated approach to analysing HRM in SMEs. Human Resource Management Journal, Vol. 16 Issue 1, pp. 48-73.
Lindman, M.T. (2004) Formation of Customer Bases in SMEs. Marketing Review, Summer, Vol. 4 Issue 2, pp. 139-156.
Singh, L.P., Bhardwaj, A. and Sachdeva, A. (2009) The Impact of Quality Management Tools on Performance: An Exploratory Study on SMEs. Journal of Operations Management, Vol. 8, Issue 3/4, pp. 61-70.
 
Last updated on 27-09-2012