Lecture 0: Course Intro | Intro to Venture Capital-FINAN 6300 | Chad Jardine, University of Utah, 2008–

Venture Capital: FINAN 6300
Course copyright © Chad Jardine. Images, works cited, etc. are copyright © their respective owners.

Advanced Venture Capital: FINAN 6310
Intro and Course Format
Course Requirements
How to get an ‘A’
Agenda

Instructor
Chad Jardine
Consultations: Call for Appointment
(801) 362-7654
chad@chadjardine.net

What to expect from FINAN 6300

Course Context & Objectives
NewCo
Company
How do I make my
startup attractive
and fund it?
Investor
Understanding the
psychology and
needs of potential
investors.
Context
Understanding the
playing field and
the rules for funding
your venture.
Deal
What goes into a
successful deal:
terms and
valuation.

Course Requirements
Agenda
✓

Course Overview
Coursework
Video Quizzes 180 pts. 36%
Discussions 80 pts. 16%
Icebreaker 30 pts. 6%
Business Mod
Canvas
100 pts 20%
Mini Case 20 pts. 4%
Case Analysis 40 pts. 8%
Final Exam 50 pts. 10%
TOTAL 500 pts. 100%
Grading
A ≥ 930 pts. ≥ 93%
A- 891–929 pts. 90–92%
B+ 861–890 pts 87–89%
B 831–860 pts. 84–86%
B- 801–830 pts. 81–83%
C+ 771–800 pts. 78–80%
C 741–770 pts. 75–77%
C- 711–740 pts. 72–74%
D+ 681–710 pts. 69–71%
D 651–680 pts. 66–68%
D-/F ≤ 650 pts. ≤ 65%

Assignments
All assignments are due at the specified
date and time in Canvas.
Late work is NOT accepted.

Quizzes: 20 pts. each. | 180 pts. total.
Each video lecture will be
followed by a short quiz.
Quizzes are taken on Canvas
= Test Question

Current Event Discussions:
Connect course material to current events
1- article with summary
3-comments on classmate articles
Discussions: 20 pts. each. | 80 pts. total.

Icebreaker Video:
Introduce yourself and
get familiar with
GoReact
You will record a short
video introduction and
comment on at least 8
of your classmates’s
videos.
Icebreaker: 30 pts.

When I die, I want the people I did group
projects with to lower me into my grave so they
can let me down one last time.

Mini Case/Story Problems
Give your brains a warm-up.
Mini Case: 20 pts.

Venture Capital: Financing for New Ventures: FINAN 6300
Business Model Canvases
The Business Model Canvas
Revenue Streams
Channels
Customer Segments
Value Propositions
Key Activities
Key Partners
Key Resources
Cost Structure
Customer Relationships
Designed by: Date: Version:
Designed for:
designed by: Business Model Foundry AG
The makers of Business Model Generation and Strategyzer
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit:
http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
What are the most important costs inherent in our business model?
Which Key Resources are most expensive?
Which Key Activities are most expensive?
is your business more
Cost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)
Value Driven (focused on value creation, premium value proposition)
sample characteristics
Fixed Costs (salaries, rents, utilities)
Variable costs
Economies of scale
Economies of scope
Through which Channels do our Customer Segments
want to be reached?
How are we reaching them now?
How are our Channels integrated?
Which ones work best?
Which ones are most cost-efficient?
How are we integrating them with customer routines?
channel phases
1. Awareness
How do we raise awareness about our company’s products and services?
2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?
3. Purchase
How do we allow customers to purchase specific products and services?
4. Delivery
How do we deliver a Value Proposition to customers?
5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?
For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?
Who are our most important customers?
Mass Market
Niche Market
Segmented
Diversified
Multi-sided Platform
What type of relationship does each of our
Customer Segments expect us to establish
and maintain with them?
Which ones have we established?
How are they integrated with the rest of our
business model?
How costly are they?
examples
Personal assistance
Dedicated Personal Assistance
Self-Service
Automated Services
Communities
Co-creation
What Key Activities do our Value Propositions require?
Our Distribution Channels?
Customer Relationships?
Revenue streams?
catergories
Production
Problem Solving
Platform/Network
What Key Resources do our Value Propositions require?
Our Distribution Channels? Customer Relationships?
Revenue Streams?
types of resources
Physical
Intellectual (brand patents, copyrights, data)
Human
Financial
Who are our Key Partners?
Who are our key suppliers?
Which Key Resources are we acquairing from partners?
Which Key Activities do partners perform?
motivations for partnerships
Optimization and economy
Reduction of risk and uncertainty
Acquisition of particular resources and activities
What value do we deliver to the customer?
Which one of our customer’s problems are we
helping to solve?
What bundles of products and services are we
offering to each Customer Segment?
Which customer needs are we satisfying?
characteristics
Newness
Performance
Customization
“Getting the Job Done”
Design
Brand/Status
Price
Cost Reduction
Risk Reduction
Accessibility
Convenience/Usability
types
Asset sale
Usage fee
Subscription Fees
Lending/Renting/Leasing
Licensing
Brokerage fees
Advertising
fixed pricing
List Price
Product feature dependent
Customer segment
dependent
Volume dependent
dynamic pricing
Negotiation (bargaining)
Yield Management
Real-time-Market
strategyzer.com
4.What’s the overall health of the market you are targeting?
5.What’s the potential of the market? (add answers to questions 1 – 4)
1.Who’s your target customer? (see Nail ItThen Scale It, p. 81)
2.What’s the job your customer is trying to perform?
3.What’s the pain your customer is experiencing while doing the job?
4. How big is the pain the customer is feeling?
5. How often are customers feeling the pain?
6.What’s the pain score? (multiply answers to questions 4 & 5)
7. How much market knowledge do you have to understand the pain?
THE BIG IDEA CANVAS
WHAT’S THE BIG IDEA? DEVELOPED BY: DATE:
1. PAIN OF THE CUSTOMER
1
Mosquito Bite
3 4
2 5
Shark Bite
Jellyfish Sting
2.Who are the current market leaders?
3.Are you competing head-to-head for their customers?
4. Do you currently have access to relevant distribution channels?
5. If yes, to what distribution channels do you currently have access?
6. Based on the proposed solution, what’s your market-entry strategy?
Developed by Paul Ahlstrom | Designed by William Standish
Dog Bite
Spider Bite
1
Flat-Lined
3 4
2 5
Super Strong
Holding Steady Improving
In Decline
4
Teeny Tiny
12 16
8
Super Sized
Medium Large
Small
5. PATH TO THE EXIT
1. How large is the universe of potential buyers for the company?
2.Who are the top likely potential buyers of the company?
3. Do you plan to engage in partnerships with them? If so, how?
4.What’s the overall likelihood of the company becoming acquired?
1
Never Ever
3 4
2 5
A Sure Bet
50/50 Very Likely
Long Odds
*
*Concept pioneered by Clayton M. Christensen.
www.nailthenscale.com
1. How many customers are experiencing the pain?
2.Are they willing and able to pay to alleviate the pain?
3.What’s the financial potential of a business that solves the pain?
2. POTENTIAL OF THE MARKET
1
A Few
3 4
2 5
Billions
Thousands Millions
Hundreds
1
Nope
3 4
2 5
Absolutely
Sometimes For the Most Part
In Rare Cases
1
Once Only
3 4
2 5
Daily
Monthly Weekly
Annually
20
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License.To view a copy of this license, please visit https://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, CA 94105, USA.
1
Taco Stand
3 4
2 5
A Unicorn
Lifestyle Company High Growth
Low Growth
3. PRESCRIPTION FOR THE PAIN
1.What’s the name of your proposed solution to the pain?
2. Describe your proposed solution to the pain and its key benefits.
3. How distinct is your solution from what already exits?
4.What types of innovation are you using to differentiate yourself?
5.What are the primary differentiators of your solution?
6. How much domain expertise do you have to solve the pain?
1
Cut & Pasted
3 4
2 5
Night & Day
Middle of Road Very Different
Almost Identical
4. POSITIONING IN THE MARKET
Technological
Business Model
Service
Customer Experience
Business Process
Product Performance
Design
Marketing
No Innovation
1.Where’s your industry in the industry life cycle?
Introduction Growth Maturity Decline
YES NO N/A PARTNERING
YES NO KIND OF N/A
Target unmet needs of underserved
customers at the low end of an existing
market; competitors flee up market
rather than fight for the low end.
Develop products that are 10x better
than market leaders; competing for
same customers with high “switching
costs” (i.e., 10x innovation).
Import proven business models and
innovations from one country to
another (i.e., geographic innovation).
Extend an existing market by adding a
product or service onto the market’s
current offerings; partner with market
leader (i.e., incremental innovation)
Face Punch Strategy
Compete head-to-head with market
leaders for existing customers with a
solution that is similar to existing
offerings (i.e., no innovation).
Greenfield Strategy
Create a brand new market category
where competition is non-existent;
create new customers and draw
customers in from other markets.
Bolt-on Strategy Geographic Strategy
Breakthrough Strategy Disruptive Strategy *
1
A Few
3 4
2 5
A Hundred
Twenty Fifty
Ten
NONE JV VARSITY PRO
NONE JV VARSITY PRO
Supply Chain Distribution Channel Other
The Pitch Canvas©
Product
Customer Traction
Product Demo What’s Unique
Business Model
Team
Why You?
Simple Statement of what change
you and your product are making in the world.
Pain (+ Gain)
Investment
Version 7.8. Produced by David Beckett and Geert van Vlijmen. Illustrations: BirgitSmit.com
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
To view a copy of this license, go to: http://creativecommons.org/licenses/by-sa/4.0/ or send a letter to
Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
DESIGNED BY: Best 3 Minutes Presentation Services
Developed from an original idea by David Beckett
Please feel free to share The Pitch Canvas©.
Ensure you reference Best3Minutes.com after each use.
Call To Action and
End Statement
An entrepreneurial brainstorming tool that helps you structure and visualise your pitch on one page .
A memorable one-sentence explanation of what you do for customers.
What problem are you solving for your customers?
What does the pain result in?
What opportunities do you provide for people to be faster,
more cost-effective, more efficient, happier, safer?
How many people need this problem solved - market size?
Have you validated that people will pay to have it solved?
Live demo? (always risky, but powerful if it works...)
A screenflow movie of a working app convinces this is
for real. Physical product convinces you can execute.
Screenshots are also OK, but can look like a mock-up -
moving product on screen is better.
Can you show a real customer using it?
As simply as possible: what does your product do
for customers?
How does it work?
How have you tested it with customers?
(Be sure not to let the product dominate the pitch.)
Technology/Relationships/Partnerships.
How do you help your customers get results differently
to your competition, or alternatives?
Show you have researched the market and know what
competition is out there.
Success so far?
Pilot customers? Major brands?
Progression in users or downloads?
Customer reference quotes or movies?
PR coverage? Competition wins?
Use data and facts to strengthen your case.
How do you get paid?
What’s the opportunity for growth?
How can you scale beyond your current
scope: new industries, territories, applications
of partnerships and technology?
Have you invested money yourself?
Have you raised money so far?
How much are you looking for now?
How many, and what type of investor are you looking for?
What expectations do you have of your investors;
network, expertise?
What big steps will you use the investment for?
What milestones will you reach with the money?
What relevant experience and skills does your team
have that supports your story?
Brands worked for? Achievements? Sales success?
What binds you together as people and as
entrepreneurs to fix this problem?
What;s special about the character of your team, that
will make you stand out and be memorable?
Finish the pitch strongly with a clear request for the audience to take action - what is their first next step?
NOTE: Why You? can show up in any part of the pitch.
Why do you care about solving this problem for your customers? How has your life been affected by this industry and business?
Why should your audience have confidence that you will do what you say you are going to do?

The Business Model Canvas
Revenue Streams
Channels
Customer Segments
Value Propositions
Key Activities
Key Partners
Key Resources
Cost Structure
Customer Relationships
Designed by: Date: Version:
Designed for:
designed by: Business Model Foundry AG
The makers of Business Model Generation and Strategyzer
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit:
http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
What are the most important costs inherent in our business model?
Which Key Resources are most expensive?
Which Key Activities are most expensive?
is your business more
Cost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)
Value Driven (focused on value creation, premium value proposition)
sample characteristics
Fixed Costs (salaries, rents, utilities)
Variable costs
Economies of scale
Economies of scope
Through which Channels do our Customer Segments
want to be reached?
How are we reaching them now?
How are our Channels integrated?
Which ones work best?
Which ones are most cost-efficient?
How are we integrating them with customer routines?
channel phases
1. Awareness
How do we raise awareness about our company’s products and services?
2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?
3. Purchase
How do we allow customers to purchase specific products and services?
4. Delivery
How do we deliver a Value Proposition to customers?
5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?
For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?
Who are our most important customers?
Mass Market
Niche Market
Segmented
Diversified
Multi-sided Platform
What type of relationship does each of our
Customer Segments expect us to establish
and maintain with them?
Which ones have we established?
How are they integrated with the rest of our
business model?
How costly are they?
examples
Personal assistance
Dedicated Personal Assistance
Self-Service
Automated Services
Communities
Co-creation
What Key Activities do our Value Propositions require?
Our Distribution Channels?
Customer Relationships?
Revenue streams?
catergories
Production
Problem Solving
Platform/Network
What Key Resources do our Value Propositions require?
Our Distribution Channels? Customer Relationships?
Revenue Streams?
types of resources
Physical
Intellectual (brand patents, copyrights, data)
Human
Financial
Who are our Key Partners?
Who are our key suppliers?
Which Key Resources are we acquairing from partners?
Which Key Activities do partners perform?
motivations for partnerships
Optimization and economy
Reduction of risk and uncertainty
Acquisition of particular resources and activities
What value do we deliver to the customer?
Which one of our customer’s problems are we
helping to solve?
What bundles of products and services are we
offering to each Customer Segment?
Which customer needs are we satisfying?
characteristics
Newness
Performance
Customization
“Getting the Job Done”
Design
Brand/Status
Price
Cost Reduction
Risk Reduction
Accessibility
Convenience/Usability
types
Asset sale
Usage fee
Subscription Fees
Lending/Renting/Leasing
Licensing
Brokerage fees
Advertising
fixed pricing
List Price
Product feature dependent
Customer segment
dependent
Volume dependent
dynamic pricing
Negotiation (bargaining)
Yield Management
Real-time-Market
strategyzer.com

The Big Idea Canvas by Alta
Ventures

THE BIG IDEA CANVAS
1
Mosquito Bite
3 4
2 5
Shark Bite
Jellyfish Sting
Dog Bite
Spider Bite
1
Flat-Lined
3 4
2 5
Super Strong
In Decline
4
Teeny Tiny
12 16
8
Super Sized
Medium Large
Small
5. PATH TO THE EXIT
1
Never Ever
3 4
2 5
A Sure Bet
50/50 Very Likely
Long Odds
*
1
A Few
3 4
2 5
Billions
Thousands Millions
Hundreds
1
Nope
3 4
2 5
Absolutely
In Rare Cases
1
Once Only
3 4
2 5
Daily
Monthly Weekly
Annually
20
1
Taco Stand
3 4
2 5
A Unicorn
Low Growth
1
Cut & Pasted
3 4
2 5
Night & Day
Almost Identical
Technological
Business Model
Service
Customer Experience
Business Process
Product Performance
Design
Marketing
No Innovation
YES NO KIND OF N/A
Face Punch Strategy
Greenfield Strategy
1
A Few
3 4
2 5
A Hundred
Twenty Fifty
Ten
NONE JV VARSITY PRO
NONE JV VARSITY PRO

Business Model Canvas
*Business Model Canvas (Draft) 30 pts. 20%
*Business Model Canvas (Final) 30 pts. 20%
*Group Presentation 20 pts. 20%
Peer Feedback 10 pts. 20%
Inter-team Evaluation 10 pts. 20%
TOTAL 100 pts. 100%
Business Model Canvas: 100 pts.
THE BIG IDEA CANVAS
1
Mosquito Bite
3 4
2 5
Shark Bite
Jellyfish Sting
Dog Bite
Spider Bite
1
Flat-Lined
3 4
2 5
Super Strong
In Decline
4
Teeny Tiny
12 16
8
Super Sized
Medium Large
Small
5. PATH TO THE EXIT
1
Never Ever
3 4
2 5
A Sure Bet
50/50 Very Likely
Long Odds
*
1
A Few
3 4
2 5
Billions
Thousands Millions
Hundreds
1
Nope
3 4
2 5
Absolutely
In Rare Cases
1
Once Only
3 4
2 5
Daily
Monthly Weekly
Annually
20
1
Taco Stand
3 4
2 5
A Unicorn
Low Growth
1
Cut & Pasted
3 4
2 5
Night & Day
Almost Identical
Technological
Business Model
Service
Customer Experience
Business Process
Product Performance
Design
Marketing
No Innovation
YES NO KIND OF N/A
Face Punch Strategy
Greenfield Strategy
1
A Few
3 4
2 5
A Hundred
Twenty Fifty
Ten
NONE JV VARSITY PRO
NONE JV VARSITY PRO

Case Analysis Reports
Investor
Entrepreneurs
(Want Investment)
Analysts/
Consultants
Should I
invest?
(You)
Cases: 40 pts.

You MUST provide a recommendation (Buy or
Sell) to receive credit.
Cases: 40 pts.

UBS Investment Research
Gogo Inc
Product announcements should drive stock
Text & Talk service to go live on business jets in October
Gogo announced that its Business Aviation (private jet) customers will be able to
make calls from their own iPhones while airborne, beginning 10/1, and from
Android phones on 11/1. Text & Talk is an add-on for Gogo Biz customers and
starts at $134.95/mo for 60 voice minutes, suggesting very attractive economics.
Expect demand for voice to drive ARPU in Business Aviation
We expect high utilization from price-insensitive biz jet customers to drive ARPU
gains in excess of the headline price as penetration ramps, given average monthly
flight time of 30+ hours per plane. Gogo’s ATG network enables it to provide
voice to airborne smartphones at quality levels similar to terrestrial wireless
service, further differentiating the product.
New technology announcement should help quell competitive concerns
Separately, Gogo said it will introduce its next-generation technology during a
webcast with Virgin America from the APEX trade show on 9/11. We expect the
announcement to address how and when Gogo will incorporate satellite
transmission into its U.S. business plan, providing a major increase in capacity and
speed. We believe this announcement will reduce worries over competitive threats.
Valuation: Maintain Buy
We believe Gogo’s business plan is strong and remains on track while these
announcements provide some catalysts. We think international wins should help
drive the stock toward our price target. Our $20 price target is DCF-based (10%
WACC, 2% perp growth).
Highlights (US$m) 12/11 12/12 12/13E 12/14E 12/15E
Revenues 160 234 308 415 605
EBIT (UBS) (34) (27) (56) (44) 30
Net Income (UBS) (18) (96) (93) (86) (13)
EPS (UBS, US$) (2.63) (14.07) (1.10) (1.02) (0.15)
Net DPS (UBS, US$) 0.00 0.00 0.00 0.00 0.00
Profitability & Valuation 5-yr hist av. 12/12 12/13E 12/14E 12/15E
EBIT margin % - -11.7 -18.3 -10.5 4.9
ROIC (EBIT) % - (15.7) (23.9) (14.1) 8.4
EV/EBITDA (core) x - - >100 18.6 6.1
PE (UBS) x - - NM NM NM
Net dividend yield % - - 0.0 0.0 0.0
Source: Company accounts, Thomson Reuters, UBS estimates. (UBS) valuations are stated before goodwill-related charges and other adjustments for
abnormal and economic items at the analysts' judgement.
Valuations: based on an average share price that year, (E): based on a share price of US$10.73 on 28 Aug 2013 17:41 EDT
John C. Hodulik, CFA
Analyst
john.hodulik@ubs.com
+1-212-713 4226
Lisa L. Friedman
Associate Analyst
lisa.friedman@ubs.com
+1-212-713 2589
Batya Levi
Analyst
batya.levi@ubs.com
+1-212-713 8824
Global Equity Research
Americas
Wireless Communications
12-month rating Buy
Unchanged
12m price target US$20.00
Unchanged
Price US$10.73
RIC: GOGO.O BBG: GOGO US
28 August 2013
Trading data
52-wk range US$14.91-9.98
Market cap. US$0.71bn
Shares o/s 66.0m (COM)
Free float 29%
Avg. daily volume ('000) 611
Avg. daily value (m) US$7.5
Balance sheet data 12/13E
Shareholders' equity US$0.25bn
P/BV (UBS) 3.6x
Net Cash (debt) (US$0.03bn)
Forecast returns
Forecast price appreciation +86.4%
Forecast dividend yield 0.0%
Forecast stock return +86.4%
Market return assumption 5.4%
Forecast excess return +81.0%
EPS (UBS, US$)
12/13E 12/12
UBS Cons. Actual
Q1 (0.17) - (2.59)
Q2 (0.23) (0.23) (1.93)
Q3E (0.34) (0.31) (4.27)
Q4E (0.36) (0.28) (5.29)
12/13E (1.10) (1.41)
12/14E (1.02) (0.79)
Performance (US$)
07/10
10/10
01/11
04/11
07/11
10/11
01/12
04/12
07/12
10/12
01/13
04/13
07/13
0.0
5.0
10.0
15.0
20.0
25.0
0
20
40
60
80
100
120
Price Target (US$) (LHS) Stock Price (US$) (LHS)
Rel. S & P 500 (RHS)
Stock Price (US$) Rel. S & P 500
Source: UBS
www.ubs.com/investmentresearch
This report has been prepared by UBS Securities LLC
ANALYST CERTIFICATION AND REQUIRED DISCLOSURES BEGIN ON PAGE 5.
UBS does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may
have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making
their investment decision.
ab
© 2014 Zacks Investment Research, All Rights reserved. www.Zacks.com 10 S. Riverside Plaza, Chicago IL 60606
The Goldman Sachs Group, Inc. (GS-NYSE)
SUMMARY
SUMMARY DATA
Risk Level * Low,
Type of Stock Large-Value
Industry Fin-Invest Bkrs
Zacks Industry Rank * 51 out of 267
Current Recommendation NEUTRAL
Prior Recommendation Underperform
Date of Last Change 02/12/2012
Current Price (09/01/14) $179.11
Target Price $188.00
Driven by strong top-line performance, Goldman s
second-quarter 2014 earnings significantly
surpassed the Zacks Consensus Estimate.
Moreover, results were higher than the year-ago
quarter figure. Investment banking revenues were
on an upswing. However, the company witnessed
an increase in expenses. We expect Goldman to
benefit from its well-managed global franchise,
strong capital base and recent investments in the
near future. Moreover, the Fed s approval of the
company s 2014 capital plan depicts financial
stability. However, regulatory issues, coupled with
fundamental pressures on the banking sector, are
expected to weigh on its financials in the coming
quarters.
52-Week High $179.37
52-Week Low $152.13
One-Year Return (%) 18.96
Beta 1.60
Average Daily Volume (sh) 2,040,683
Shares Outstanding (mil) 441
Market Capitalization ($mil) $78,988
Short Interest Ratio (days) 3.52
Institutional Ownership (%) 69
Insider Ownership (%) 3
Annual Cash Dividend $2.20
Dividend Yield (%) 1.23
5-Yr. Historical Growth Rates
Sales (%) -7.7
Earnings Per Share (%) -1.4
Dividend (%) 12.6
P/E using TTM EPS 11.5
P/E using 2014 Estimate 10.7
P/E using 2015 Estimate 10.3
Zacks Rank *: Short Term
1 3 months outlook 2 - Buy
* Definition / Disclosure on last page
ZACKS CONSENSUS ESTIMATES
Revenue Estimates
(In millions of $)
Q1 Q2 Q3 Q4 Year
(Mar) (Jun) (Sep) (Dec) (Dec)
2012 9,949 A 6,627 A 8,351 A 9,236 A 34,163 A
2013 10,090 A 8,612 A 6,722 A 8,782 A 34,206 A
2014 9,328 A 9,125 A 7,768 E 8,326 E 34,547 E
2015 34,803 E
Earnings Per Share Estimates
(EPS is operating earnings before non-recurring items, but including employee
stock options expenses)
Q1 Q2 Q3 Q4 Year
(Mar) (Jun) (Sep) (Dec) (Dec)
2012 $3.90 A $1.78 A $2.85 A $5.60 A $14.13 A
2013 $4.28 A $3.70 A $2.88 A $4.60 A $15.46 A
2014 $4.02 A $4.10 A $3.21 E $5.42 E $16.75 E
2015 $17.37 E
Projected EPS Growth - Next 5 Years % 5
September 02, 2014
Flash Note
January 8, 2014
Rubicon Technology
Offering To Fund 2014 Expansion Opportunities; Maintain Buy
Our Call
We view expected share weakness from the offering as a buying opportunity as
Rubicon raises funds to take advantage of positive industry fundamentals in 2014.
Maintain Buy.
FOLLOW-ON STOCK OFFERING ANNOUNCEMENT. Rubicon announced
the sale of $28.2 million of common stock to fund research and development of
new products, for capacity expansion and for general corporate purposes. The deal
was done at $10.65 per share, a 7% discount to Rubicon's closing stock price of
$11.44 on January 7.
STERNE AGEE VIEW. While the stock will likely trade down on the dilution
and deal discount, we view the potential stock weakness as a buying opportunity.
We believe management's outlook for the industry is as bullish as ours; however,
in order to capture the opportunity, Rubicon must add floor space and patterned
sapphire substrate (PSS) capacity in Malaysia. Rubicon believes the launch of PSS
wafers should generate $15 million in revenue for 2014, most of which should
be 4 inch wafers. For 2014, we expect fundamentals each quarter to improve
sequentially, driven by: price increases for 2 and 4 inch core, decreasing idle
capacity charges, and a modest recovery in demand for 6 inch LED wafers. These
should result in steady gross margin and EPS improvement throughout the year.
Maintain Buy.
Buy
RBCN
Price $11.44
Price Target $17.00
LED Supply Chain &
Semiconductors
Andrew Huang
(415) 362-6143
ahuang@sterneagee.com
John Shen
(415) 402-6052
jshen@sterneagee.com
Company Data
52-Week Range $4.83 - $13.78
Market Capitalization (M) $257.0
Shares Outstanding (M) 22.7
Avg. Daily Vol. (000) 432.0
Estimates Q2 2013E 2014E
EPS (0.26) (0.89) (0.30)
For the latest company report:
RBCN Company Report
Any Important Disclosures regarding Price Target Risks, Valuation Methodology, Regulation Analyst Certification,
Investment Banking, Ratings Definitions, and any potential conflicts of interest begin on Page I of the Appendix
Section. Past performance is no guarantee of future results.
800 Shades Creek ParkwaySuite 700Birmingham, AL 35209205-949-3500
Sterne, Agee & Leach Inc. is Member NYSE, FINRA, SIPC
Buy
NEUTRAL
Buy
Cases: 40 pts.

“If you’re trying to create a
company, it’s like baking a cake.
You have to have all the ingredients
in the right proportion.”
—Elon Musk
Photo Credit: Business Insider

Recommendation
Buy/Sell on pg. 1
S.W.O.T.
1 page
Risk Analysis
4 Components
1 page
Quantitative
1 page
Summary &
Presentation
1–3 pages
Cases: 40 pts.
Include Appendices
if Necessary
e.g., financial
statements, detailed
quantitative analysis
goes after required
sections
TL;DR
Not too short, not
too long.

Case Analysis Grading
Presentation & Summary 10 pts. 25%
S.W.O.T Analysis 10 pts. 25%
Components of Risk 10 pts. 25%
Quantitative 10 pts. 25%
TOTAL 40 pts. 100%
Case Analysis Report: 40 pts.

IRL, DO NOT INVEST in any
company you learn about
during this course!
Cases: 40 pts.

Final Exam (50 pts.)
Final Exam
Questions will be a combination of
multiple choice, true/false, short
answer and essay.
I will not intentionally throw in
surprises or esoteric content!
= Test Question

Policies
Late Assignments
Late work is NOT accepted. Legitimate emergencies and university policy exceptions will be observed.
Discussion of Grades
Grades are open for discussion for two weeks after they have been reported to you. After that time,
grades are final.
Academic Honesty
Students are expected to uphold high standards of academic honesty. Work of another person that is
misrepresented as one's own or other dishonesty shall be cause for course failure. Use or copying of
another person's material, even with modification, must be fully referenced. Student work must be
done independently, unless otherwise noted.
Americans with Disabilities Act
The University of Utah seeks to provide equal access to its programs, services and activities for people
with disabilities. If you will need accommodations in this class, reasonable prior notice needs to be
given to the instructor and the Center for Disabled Student Services, 581-5020 (voice or TDD), 160
Olpin Building, to make arrangements for the accommodations. This information is available in
alternative format with prior notification.

Course Requirements
Agenda
✓
✓

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Course Requirements
Agenda
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Lecture 0: Course Intro | Intro to Venture Capital-FINAN 6300 | Chad Jardine, University of Utah, 2008–

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Lecture 0: Course Intro | Intro to Venture Capital-FINAN 6300 | Chad Jardine, University of Utah, 2008–