EXECUTIVE EDUCATION TRAINING VENTURE CAPITAL WORKSHOPS Programme Overview The Private Equity and Venture Capital Executive Education training programmes are two workshops, each held over two-days. Both programmes explore key principles and practices of private equity investing, designed to ensure specific outcomes for participants. The programmes are built around a series of workshop exercises designed to illustrate to delegates the practical experiences that drive current private equity practice. These exercises are supplemented by consolidatory reviews of current tools, techniques and practices. Course Director Garry Sharp Ascentium Associates Ascentium Associates a London-based institution specialist-training provider focused on the private equity, real estate and infrastructure/project finance sectors. The company s training programmes are delivered by highly experienced practitioners enabling participants to learn from seasoned veterans deliver the company s industry course programmes. Key Learning Outcomes: Attendees will finish the programme with a sound understanding of: i) The evolution of private equity and its role in an investment portfolio ii) The range of value creation strategies and their relationships to stages and types of investment iii) Key issues in investment selection and appraisal iv) Structuring and valuation, venture, growth capital and buyout investments v) Post investment management and protection of interests vi) Exit strategy development and execution The nature of the training sessions is that they are composed of a series of highly interactive presentations, dialogue and group exercises, requiring input and discussion from attendees. As such there will be ample opportunity during the sessions to involve local PC/VC professionals, sharing issues relating to the local market. 1
Workshop #1 June 30 July 1 2014 General Principles and Practices This course is aimed at all Market Participants: - Private Equity Professionals - Entrepreneurs - Academics - Consultants and Advisors - Business Development professionals - Senior Management - Finance Managers - Accountants and Lawyers - Incubator Managers Day 1 Topics Course Outline The Private Equity Governance Model - How.. and why..it works - Value creation and its link to governance - Industry structure the links from portfolio companies to institutional investors - The institutional viewpoint private equity as an asset class; how it performs and where it fits Group Exercise Investment Strategy: development and discussion. Attendees will work in teams to develop an investment strategy for a new, first time private equity fund. Review of the teams differing proposals will lead to powerful insights into how PE fund managers position themselves to add value in today s markets. Risks and Rewards - Definitions clarified - types of investment from seed, to venture, to buyouts and club deals 2 - Key risks area and their relationships to investment stage - Returns and their drivers Group Exercise Investment Selection: early bird decision points. Value creation is a much used and often misunderstood term; in this exercise, teams will review a range of preliminary investment proposals, leading to a discussion of potential to create value and key commercial decision points. 2
Change of control/buyout investments - Value creation in buyouts - The three key routes - Current practice and market evolution - The buyout model - The use of leverage - Incentivizing operational management - Types of debt and their application - Deal flow generation Group Exercise A buyout structuring challenge. Attendees will play the role of corporate finance adviser to the CEO of a buyout target company and will explore the basic structure of a buyout, with guidance from the programme director. Structuring Growth Capital Investments - Fundamental structuring principles - Alignment of interests and motivations - Valuation tools, techniques and templates - Variety and use of differing instruments - Specific techniques for protecting minority stake investors - The use, and potential dangers, of ratchets Day 2 Topics Group Exercise Structuring Basics. Attendees will structure a simple growth capital investment, initially without the use of a spreadsheet. This exercise is designed to consolidate understanding of: - The key drivers of private equity returns - The effects of introducing various investment instruments - The dangers of relying purely on spreadsheets Group Exercise Applied Stucturing. Attendees will split into groups and develop alternative structures for a proposed growth capital investment. Due Diligence - The Due Diligence process, its value and its role in enhancing value - Types of Due Diligence: o Commercial o Financial o Operational o Legal o Specialist and other Post Investment Management - Key tools, techniques and mechanisms for protecting value - Value addition and the concept of the full potential plan 3
- Corporate Governance and the investor / operating management relationship Exits - Understanding different exit routes; their relative attractions and drawbacks - Developing and implementing an exit strategy - Contractual and structural tools and techniques - Identifying and dealing with changing objectives and conflicts of interest - Practical issues and making exits work in reality Fund Terms and Conditions - Key Issues for Limited Partners: - Carried Interest - Key Executive Clauses - Management Fees - Removal of Manager - Treatment of Transaction Fees End of Course Outline for Workshop # 1 4
Workshop #2 July 3-4 2014 Specialized Training for Private Equity and Venture Capital Investors This course is aimed at: - Private Equity Professionals - Limited partners - Institutional Investors - Angel Investors - Bankers and corporate financiers - Corporate merger & acquisition teams - Family Offices - Finance Managers - Consultants Day 1 Topics Course Outline Fund manager due diligence and selection - Investment strategy relevance to asset allocation - Investment strategy ability to deliver - Analysis of historical performance - Team composition and stability - Reward allocation Fee structure - Management fee - Carry, catch up and clawback - Current state of market and likely developments - Alternative approaches Risk and rewards - Return distributions - Enhanced returns through diversification - The importance of vintage and GP distribution Corporate governance - GP investment process and controls - Advisory Panel composition and role 5
- Style drift and adherence to investment strategy - Warning signs and preventative actions Monitoring and reporting relationships Formal reporting o Annual o Quarterly Informal reporting Benchmarking - Comparative performance - Dealing with underperformance Management of conflicts Exits - Conflicts within GP team - Conflicts of interest - Remedies for LP s - Objectives and timing - Distribution waterfalls - Carry allocation, escrow and clawbacks Day 2 Topics Legal agreements, term sheets and other contracts and documentation - Limited Partnership Agreements (or equivalent) key terms - Side letters, MFN clauses - Co-investment arrangements Valuations - Valuation principles and guidelines - Specific methodologies and their application - The role of the auditor - Valuation disputes Asset allocation - PE and VC vs other asset classes - Allocation within PE portfolio 6
Liquidity management, co-investing, directs, secondaries - Cash flows associated with PE - Commitments vs drawdowns - Return enhancement via secondaries ILPA Principles and other international best practices. - ILPA evolution and role - Key ILPA guidelines - ILPA and the GP End of course Outline for Workshop No 2 For more information, and registration details, please visit www.venturecapitaljamaica.com or call The Venture Capital Unit Development Bank of Jamaica, 1-876-929-4000 ext. 4172 Enquiries may also be emailed to: venturecapitaljamaica@dbankjm.com 7