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2024/2025  KAN-CCMVV2427U  Financing Innovation and Entrepreneurship

English Title
Financing Innovation and Entrepreneurship

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration One Quarter
Start time of the course First Quarter
Timetable Course schedule will be posted at calendar.cbs.dk
Study board
Study Board for cand.merc. and GMA (CM)
Course coordinator
  • Ali Mohammadi - Department of Strategy and Innovation (SI)
Main academic disciplines
  • Entrepreneurship
  • Finance
  • Innovation
Teaching methods
  • Blended learning
Last updated on 09-02-2024

Relevant links

Learning objectives
On successful completion of the course students should be able to:
  • Understand and compare different types of innovation investments (internal R &D, Corporate venture capital, joint venture, R & D Subsidies, etc.).
  • Explain the theoretical differences between R & D investment and capital investment.
  • Understand the interaction between financial markets (e.g. analysts, shareholders, etc.) and firm investment in innovation.
  • Become familiar with some tools to select innovation projects.
  • Understand and compare various financial sources available to different types of start-ups. and possible exit scenarios
  • Conduct a financial valuation of a start-up firm and apply it in real cases.
  • Understand and explain possible reasons for the biases in entrepreneurial finance market.
  • Evaluate the consequences of terms in the contracts between entrepreneur and investor
  • Demonstrate the ability to make recommendations for firms based on arguments that are sensible, logical and coherent.
Financing Innovation and Entrepreneurship:
Exam ECTS 7,5
Examination form Written sit-in exam on CBS' computers
Individual or group exam Individual exam
Assignment type Written assignment
Duration 4 hours
Grading scale 7-point grading scale
Examiner(s) One internal examiner
Exam period Autumn
Aids Limited aids, see the list below:
The student is allowed to bring
  • Any calculator
  • Language dictionaries in paper format
The student will have access to
  • Advanced IT application package
Make-up exam/re-exam
Same examination form as the ordinary exam
The number of registered candidates for the make-up examination/re-take examination may warrant that it most appropriately be held as an oral examination. The programme office will inform the students if the make-up examination/re-take examination instead is held as an oral examination including a second examiner or external examiner.
The number of registered candidates for the re-take exam warrants if the exam, most appropriately, is to be held as an oral examination. The students will be informed if the re-take examination will be held as an oral examination instead.
Description of the exam procedure

Exam will include multiple choices, essay and calculation questions based on theories and cases, which will be provided to students

Course content, structure and pedagogical approach

Course Description:

Innovation and entrepreneurship are engines of economic growth and job creation. They are also key driver of firms’ future competitiveness and productivity. Financing R&D projects differs from financing other types of projects such as capital investments. This is mostly due to high uncertainty associated with R & D projects and outcome of them.  In addition, well-functioning financial markets can nurture technological innovation through two channels. First financial markets can allocate capital to the most promising projects or firms with the greatest potential to develop and commercialize new technologies. Second, financial markets can influence the direction of innovation and shape the nature of R&D that is undertaken by firms. This course will focus on relationship between financing and innovation in both established firms and innovative entrepreneurial ventures.


Course Contents:

The course will be delivered in two parts.

  1. In the first part, we will focus on large established firms. In this part, we discuss:
    1.  Different types of innovation investments (internal R & D, Corporate venture capital, joint venture, etc.).
    2. The interaction between financial markets (e.g. analysts, shareholders, etc.) and firm investment in innovation.
    3. Some tools to evaluate and compare investment opportunities in innovation projects.
  2. In the second part, we will focus on innovative entrepreneurial ventures. This section aims to provide an overview of:
    1.  Funding sources for new ventures (e.g. venture capital, Angels, Crowdfunding, Initial coin offering) and implications of different types of investors.
    2. Methods of financial valuation of a start-up firm,
    3.  The structure of financial contracts between entrepreneurs and external investors
    4. Biases in entrepreneurial finance market.

The course is relevant for students planning to become entrepreneurs, or working in high tech sector, investment firms, private equity firms, public institutions supporting innovation and entrepreneurship, and consulting.

Description of the teaching methods
This course is conducted based on a combination of research-based lectures, case discussions and guest lectures. Pre-recorded lectures will be provided for some of the topics.
Feedback during the teaching period
Feedbacks are provided during case discussions, Q&A time in class, and office hours.

Student workload
Class attendance 30 hours
Preparation and exercises 102 hours
Exam 74 hours
Further Information

Connection to Nordic nine:

This course tries to help students to analyze entrepreneurial and innovative projects that are associated with high level of ambiquity. Students learn what type of information are relevant and how to deal with ambiguity. We also try to learn about differences across settings and industries. Furthermore we discuss underlying theories for observed inequalities in financing entrepreneurship and innovation. Hence the course is directly connected to following Nordic Nines:


- You are analytical with data and curious about ambiguity

- You recognize humanity's challenges and have entrepreneurial knowledge to help resolve them.

- You have deep business konwledge placed in broad context. 

- You are competitive in business and compassionate in society.


Expected literature

Reading materials include book chapters, research articles, lecture slides and case studies. For each lecture, teacher will provide additional supplementary readings.


  • Andrew Metrick, Ayako Yasuda, 2011. Venture capital and the finance of innovation, 2nd ed. Chapter 20, 21 & 23.
  • Da Rin & Hellmann's Fundamentals of Entrepreneurial Finance. Oxford University Press.

Research articles :


  • Ramana Nanda & William R. Kerr, 2015. "Financing Innovation," Annual Review of Financial Economics, Annual Reviews, vol. 7(1), pages 445-462
  • Guo, B., D. P´erez-Castrillo, and A. Toldr`a-Simats (2019). Firms’ innovation strategy under the shadow of analyst coverage. Journal of Financial Economics 131 (2), 456–483.
  • Gompers, Gornall, Kaplan, and Strebulaev (2021), How Venture Capitalists Make Decisions, Harvard Business Review.
  • Ewens, M., & Townsend, R. R. (2019). Are early stage investors biased against women? Journal of Financial Economics.
  • Additional research articles will be provided for each lecture

Cases :

  • Case study material is available in a course package from HBS. The link to the course package will be provided in the beginning of the course.

Slides :

  • Slides provided by teacher will be part of the exam material.
Last updated on 09-02-2024