Section Description Provided by Instructor
This 2-point seminar will focus on the law and finance of private capital as an alternative form of equity ownership. For the last two decades, capital formation in the United States has been undergoing a significant transition away from public equity markets (such as the NYSE) and towards private ownership; but the causes of this transformation—and its consequences for law and regulation involving private and public markets—have remained largely unexplored. Although public equity markets remain vast and important, they are no longer the primary source of capital for business formation and growth. Increasingly, capital for business formation and growth is being raised—and held—privately from a relatively new set of institutional investors (most importantly, venture capital and private equity funds). As a result, ownership and control over significant swaths of American business has shifted from participants in public markets to participants in the private markets.
In this course, we will work collectively on gaining greater traction in this important area for law and policy. Collectively, our principal deliverable for the class will be a group project, to which everyone (including the instructors) will contribute, and which will concentrate on an overall assessment of private capital in its current state. Each student in the class will be required to contribute a chapter (or section thereof) to this report, and the final report will be jointly authored by all of us and submitted to an appropriate publication venue. A large part of the project (around half) will be data oriented, using best available data to analyze the current breadth and reach of private ownership markets, likely concentrating on a few core industries. The project will also involve an examination of the typical features of venture capital and private equity portfolio company governance structures and documents, including the ways in which they differ from publicly traded Delaware corporations.
For the first  weeks of class, we will discuss current legal and financial research and trends related to the private markets, as well as related industry and regulatory material, to provide an overview of the private markets generally and to help orient the project within the broader business and legal conversation. Students in the class will take turns (assisted by the instructors) leading the discussions.
Grades will be based on (a) your final “deliverable” (a chapter or portion thereof) (60%), and (b) participation points (40%). The deliverable will be due the last day of the exam period. Participation points will be a function of regular attendance, quality in-class participation, and two student-led presentations each student will make during the course of the term.
Method of Evaluation
J.D. Writing Credit
Minor (automatic), Major (only upon consultation) (Major writing credit may be considered upon consultation for 2Ls, not 3Ls.)