...Funding A Business Venture John S. Garrett Jr. American Intercontinental University Abstract A business venture is a huge risk that involves money, time, patience, endurance and commitment. Money is needed to get the business off the ground and running. Time is required to give the business a chance to produce a profit. There are going to be good and bad days and you must have patience to see the venture through. There will be some tough and long roads ahead and you will need to endure them. If there is no commitment, you have wasted money, time, patience and endurance to a project that will affect you monetarily and possibly credit wise. Funding a Business Venture The pros and cons to starting-up a business have been weighed. I do not have the money to start-up a business and neither the patience or time to see a business venture through. I weighed my options in starting a business: borrow money, sell stock, or license the technology. I have decided to license my technology. By doing this, I will have freed up my time and will not have to worry about incurring the expense in manufacturing, marketing, distributing, and selling a product. (Jackim, 2009) Nothing is easy in business. Sacrifices have to be made and deciding in which direction to go are major decisions. Go and talk with an investment banker. An investment...
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...FUNDING A BUSINESS VENTURE BUSN105-279 AIU Online Abstract Mrs. Bourne informs her readers of her viewpoint on investment bankers, the stock market, financial management, and risk financing. She then informs the audience of her and her business partner’s financial choice for starting their small business. The author wants the readers to understand why she and her partner made the choice that they made and what their second financial option would be if needed. She will describe the positives and negatives of each of their choices. Funding a Business Venture Investment banking is strictly buying and selling businesses for a profit. Investment bankers come up with a company’s value and buy the company from the owner, only to turn around and sell it piece by piece to the public. By selling the company in shares the investment banker makes a profit. Investment bankers are important because they assist in the introduction of initial public offerings. The stock market is what we call the registry of stocks and bonds that have been bought and sold. The function of the stock market is to keep a society informed about economic transactions and the value of certain stocks and bonds. The stock market is important because it keeps Americans knowledgeable about the rises and falls of the world that we live in. It is very important in keeping businesses running smoothly financially. Financial management is simply managing a business’s finances. Someone who is in the financial...
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...Kendra Anders Funding A Business Venture 10/20/2013 AIU Online Abstract: The meaning, function, and importance of the four elements as follows. The four elements in business (stock market, risk financing, investment banker, financial management) are presented in this paper. The pros and cons are presented by the author of various to fund the starting of the business. Funning A Business Venture The stock market, transition from one stock broker to another. It is also known as equity market. The shares are listed on stock exchange, also being that the shares are privately traded. stock is important because it keeps people with the knowledge that is needed about the rises and falls. The most important is keeping the business running smoothly. It's also important because it is a good source for raising money for a business. Firms can raise capital by allowing companies to be traded publicly. If a newly business own has lack of knowledge about sock marketing it can be unforgiving. Risk financing provides funds and plan to insure that finances are available in case the unpredictable loss can happen. It is important for a business to involve themselves in risk financing due to the fact that it can bail a tremendous financial problem. Investment banker advise their clients on high levels of financial organizations. By selling the company in shares the investment banker makes a profit. The banker purchases the issue from the corporation arranges to resell the issue...
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...AND FUNDING 1 Business and Funding American Intercontinental University BUSINESS AND FUNDING 2 Abstract When it comes to business there is always more to learn. This weeks paper will look at a couple very important terms having to do with business management; investment banker, stock market, financial management, and risk financing. The paper will take a brief look at the function and importance of each of these terms and how they apply to business. I will also discuss how I will fund my new business venture, and why I choose that way of funding. There are a variety of ways to fund a business including borrowing from friends and family or even seeking out investors. There is no right or wrong way to fund your business, just what way works best for you and your situation. BUSINESS AND FUNDING 3 Funding a Small Business Venture Previously I discussed the way in which I wanted to run my business. I chose to run my new small business as a sole proprietor. As a sole proprietor I will run my own business and be taxed at a personal income level, and I personally am liable for all business debt (The Ultimate Resource, 2009). I will give you a brief reminder of my situation, I am starting my own small business for a new product I invented, and I believe this product can be used for a wide range of applications. I am very new to the business world...
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...Environments of Business – Funding A Business Venture Susan Blanks AIU Online Abstract After Susan had made the decision to license her technology as a means of funding her business, she had to decide what type of licensing contract she wanted. She decided that she would negotiate a contract for a combination of an up-front fixed fee and a per unit output royalty. She made this decision based on the fact that she and the licensee would be competitors and the realization that the threat of imitation was credible and that the cost of imitation was positive. She knew that because her technology was going to improve the licensee’s profits that she would benefit financially as well. She chose to license her technology in the domestic market because she discovered that depending on the county, government policy might prevent competition in the licensee’s market. Susan knew that this was just the beginning and that she still had a lot to investigate and learn, but she felt up to the challenge. She was amazed to discover that there was so many avenues one could take when trying to fund a business. My preferred source of funding is to license the technology. Unit 2_Glossary.pdf, when a company develops a special, unique, technology it will frequently allow other firms to license that invention, in return for giving the firm, which developed it, a share of the revenues the second firm earns. I chose this source of funding because I didn’t want to borrow from a bank because...
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...About Venture Capital (VC) | Starting and growing a business always require capital. There are a number of alternative methods to fund growth. These include the owner or proprietor’s own capital, arranging debt finance, or seeking an equity partner, as is the case with private equity and venture capital. Private equity is a broad term that refers to any type of non-public ownership equity securities that are not listed on a public exchange. Private equity encompasses both early stage (venture capital) and later stage (buy-out, expansion) investing. In the broadest sense, it can also include mezzanine, fund of funds and secondary investing. Venture capital is a means of equity financing for rapidly-growing private companies. Finance may be required for the start-up, development/expansion or purchase of a company. Venture Capital firms invest funds on a professional basis, often focusing on a limited sector of specialization (eg. IT, infrastructure, health/life sciences, clean technology, etc.). The goal of venture capital is to build companies so that the shares become liquid (through IPO or acquisition) and provide a rate of return to the investors (in the form of cash or shares) that is consistent with the level of risk taken. With venture capital financing, the venture capitalist acquires an agreed proportion of the equity of the company in return for the funding. Equity finance offers the significant advantage of having no interest charges. It is "patient" capital...
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...Innovation March 02, 2011 Question: Discuss the sources of funding of the new venture and the rationale for using each source. The securing of funding for a new venture is perhaps the most difficult part of the venture start-up process (Hisrich, Peters, & Shepherd, 2010). The sources of funding for a new venture entry may be varied in such forms as Self, Family and Friends, Suppliers and trade credit, Commercial banks, Government Loan programs, R&D limited partnerships, Private investors (angels) Venture Capital, Private equity placements, Public equity offerings and other government programs (Hisrich, Peters, & Shepherd,2010). The Ready Clip will plan to seek funding or financing by using the Self of Personal Funds from the above referenced methods list. T he Self or Personal Funds source of funding method is the most utilized funding or financing for venture start-ups, as well as being the least expensive for cost and control (Hisrich, Peters, & Shepherd, 2010). The low cost and control of the Personal Funds is of particular interest to the Ready Group Members, as that we are still analyzing the ventures opportunity for success as well as weighing the passion and financial commitment levels of the Ready Clip Members. The level of commitment is generally reflected in the entrepreneur’s percentage of the total assets and not the necessarily the amount of money the entrepreneur has put into the venture (Hisrich, Peters, & Shepherd, 2010). The Group is prepared...
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...Venture capital (VC) is monetary capital gave to early stage, high-potential, development new businesses. The venture capital store procures cash by owning value in the organizations it puts resources into, which typically have a novel innovation or plan of action in high innovation businesses, for example, biotechnology and IT. The ordinary venture capital speculation happens after the seed financing round as the first round of institutional capital to store development (likewise alluded to as Series A round) in light of a legitimate concern for creating a return through a consequent acknowledgment occasion, for example, an IPO or exchange offer of the organization. Venture capital is a sort of private equity. In addition to angel investing, equity crowd funding and other seed funding options, venture capital is attractive for new companies with limited operating history that are too small to raise capital in the public markets and have not reached the point where they are able to secure a bank loan or complete a debt offering . In return for the high risk that venture capitalists accept by putting resources into little and less develop organizations, venture capitalists typically get huge control over organization choices, notwithstanding a significant allotment of the organization's proprietorship (and subsequently esteem). Venture capital is likewise connected with occupation creation (representing 2% of US GDP), the learning economy, and utilized as an intermediary measure...
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...IDEA AND MARKET DESCRIPTION Steve Ugbah Prepared for: School of Business & Technology Introduction Entrepreneurship has significantly contributed to society’s climb from underdevelopment to affluence. This has been accomplished through the introduction of new products and technologies to better satisfy consumer wants and raise productivity. An entrepreneur, therefore, is a person who organizes and manages a business, assuming the risk for the sake of potential return (Mariotti & Glackin, 2012). The entrepreneur is an innovator who brings about change through the introduction of new technological processes or products, and thus, through innovation, the entrepreneur is a “deliberate wrecker of equilibrium.” Successful entrepreneurship is associated with a high degree of practical intelligence, creative abilities, and business talent, characteristics which Shavinina (2006) refers to as “entrepreneurial giftedness” (p. 225)--talented individuals who exceptionally succeeded in business by creating new ventures. According to Darling, Gabrielsson, and Seristo (2007), entrepreneurial management leadership is all about “breaking new ground, going beyond the known, and helping to create the future.” Also, entrepreneurial management leadership is about helping people settle into new opportunities that give them joy and hope for the future. The keys to entrepreneurial success are not intelligence, education, lifestyle or background. Rather, entrepreneurial success is determined...
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...NAME: SIMENI ENEYI GABRIEL DEPT: ECONOMICS TOPIC: DIFFERENCE BETWEEN VENTURE CAPITALISTS AND ANGEL INVESTORS EMAIL: gabrielsimeni@gmail.com DIFFERENCE BETWEEN VENTURE CAPITALISTS AND ANGEL INVESTORS Both are affluent individuals who provide capital for a business start-up, usually in exchange for convertible debt or ownership equity. However, they differ from Friends and Family who will typically invest very early when all one has is an idea. The prevailing challenge is people would rather invest in the company rather than the individual. In this regard, it is okay to say that Angel Investors look for same things as Venture Capitalists, but their differences play a hard role in shaping the financial strategies and the future of the business. Venture Capitalists are one way to raise serious amount of capital but as you may imagine there are pitfalls. The final vote on ‘the right of sale’ will also most probably be a mandatory right for them. Since Venture Capitalists main motivation is “Return on Investment as Soon as Possible” they always have an almost manic desire to take over every entrepreneur as quickly as possible and they care less where that return comes from as long as they are able to receive a massive bonus for the risk and skill that they have invested. More appealing to an entrepreneur starting-up is to seek out a business angel investor that is interested in the line of work you are involved in, as they will either take an equity...
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...FUNDING A BUSINESS VENTURE Unit 2-IP 1 THE FUNDING OF A BUSINESS RUDOLPH LUCIEN Introduction to Business BUSN105-1203B AIU July 29, 2012 FUNDING OF A BUSINESS VENTURE Unit 2-IP 2 ABSTRACT This essay will cover a list of issues facing the start of a new business and the funding of one. I will talk about the 4 terms investment banker, the stock market, financial management, risk financing, and how each one of them works. I will also discuss 1 of 3 ways that you can use when funding your business. Finally I will identify, describe, and explain everything else that deals with making a funding decision. FUNDING A BUSINESS VENTURE Unit 2-IP 3 Investment Banker Investment bankers are: They are critical figures in financial markets. They are involved in virtually all large financial transactions including mergers and acquisitions, initial public offering, and other securities offerings. An investment banker is someone who also helps companies raise capital by trading in securities and other investments. They function as: Investigation, Analysis and Research (Origination), Underwriting (Public cash offering) and Distribution. Most of the time a single investor banker performs all...
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...Trend in Entrepreneurial Activity and Funding During Fluctuating Economic Cycles Introduction Global capital markets have been greatly impacted by the current economic climate. This has created significant challenges in startup capital and infusions of capital from Venture Capital funds or other types of angel investment. 2011 was, indeed, a transitional year for small businesses around the world. The primary issue is that it has become clear that credit will remain less available and that many institutions will remain risk-averse. A simple assessment would be that there was a hope that credit would start flowing again and that investment would be less restricted and it has now become clear that this is not a short-term problem. There was a time when a solid business plan was enough, then having a background in startups became desirable, then having the ability to prove one’s concepts became more important. In order to better understand what an entrepreneurial organization, especially a small business, needs to do in this current economic cycle, this research will look at numbers and types of market entrants, initial public offerings, funding opportunities, and ways to enhance profitability. This research will also examine how the fluctuations of various economic cycles have an impact on funding sources. The funding sources of angel investment, venture capital, private equity, and bootstrapping will be considered, leading into an understanding of the perspectives of the various...
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...15.975 Nuts and Bolts of Business Plans Session on Financing Excerpts from Angel Investor Study Venture Support Systems Project: Angel Investors MIT Entrepreneurship Center Release 1.1 February 2000 The Venture Support Systems (VSS) Project is managed by a team at MIT and HBS. It was funded by a generous donation from Ronald A. Kurtz (MIT 1954) and David Kurtz (HBS 1992). Other reports from the VSS Project include cases, teaching notes and monographs. This report was prepared by Lucinda Linde (Marlin Capital) and Alok Prasad (Pittiglio, Rabin, Todd & McGrath) under the direction of Kenneth P. Morse and Matthew Utterback of the MIT Sloan School and Howard Stevenson and Michael Roberts, of the Harvard Business School. �2000 MIT Entrepreneurship Center Executive Summary Angel investors are an important and growing source of financing for the start-up and initial growth phases of technology ventures. This study focused on high net worth angel investors with entrepreneurial backgrounds. Many of these angels invest in first time entrepreneurs before the entrepreneurs secure venture capital financing. Besides earning a strong return on their investment, these experienced angels are motivated to “give back” to the community which helped make them successful. Very little published data is available on angel investing and little research has been done on the experienced angel investor. It may be valuable for first time entrepreneurs, venture capitalists, regulators...
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...Hill Contents 1 Venture Capital 4 2 Mechanics of raising equity capital 5 2.1 Equity financing for private companies – Sources for funding 5 2.1.1 Angel Investors 5 2.1.2 Venture Capital Firms 6 2.1.3 Institutional Investors 6 2.1.4 Corporate Investors 6 2.2 Outside Investors 6 2.3 Exiting an Investment in a Private Company 7 3 The process of start-up funding 8 3.1 Idea and co-founder stage 8 3.2 Family and friends stage 8 3.3 Seed or angel round 8 3.4 Venture Capital Round 8 4 The Initial Public Offering 10 4.1 Advantages and Disadvantages of Going Public 10 5 Key Elements for successful Entrepreneurship 11 6 The importance of Silicon Valley in the U.S. venture capital system 13 6.1 Venture Capital Investment in the U.S. 13 6.1.1 Venture Capital Investment since 2006 13 6.1.2 Investment by industry 13 6.1.3 Investment by regions 15 6.2 Evolution of Silicon Valley 15 6.3 Silicon Valley – an advanced high tech entrepreneurial habitat 16 6.4 The Power of Clustering 16 6.5 Features of an advanced high tech entrepreneurial habitat 16 6.6 The high-tech habitat: Value-added support 17 6.7 Impact of Stanford University on Silicon Valley 18 7 Entrepreneurship and Funding - Differences between Europe and U.S. 19 7.1 Venture Capital Investment in Austria and Europe 19 7.2 Development of Private Equity in Austria 20 7.3 Development of Private Equity in Europe 20 7.4 Venture Capital Investors...
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...INTRODUCTION Difficult access to funding is one of the most important constraints to the growth and development of SME’s. Recent developments in our country, the global economic and financial crisis has further degraded the situation in the area and increased the pressure to find alternative sources of funding. Therefore, the search for alternative sources of funding has become increasingly common in recent years. It is based on the close co-operation between investors, intermediaries and entrepreneur. Crowdfunding is solicitation of funds which are collected in small amount from multiple investors through a web-based platform or social networking site for a specific project, business venture or social cause. It allow entrepreneurs to raise...
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