Question 1

What type of investment vehicle do venture capital money managers typically use?

Accepted Answer

A) bank loan 
B) limited partnership fund 
C) angel account 
D) investment bonds 
A) bank loan 
B) limited partnership fund 
C) angel account 
D) investment bonds B

Question 2

Venture capital became more organized and professional with the 1946 creation of American Research and Development.

Accepted Answer

A) True 
 B)False  True

Question 3

An investor offers $150,000 for 30% of the company.What is the post-money valuation of the company?

Accepted Answer

A) $350,000 
B) $500,000 
C) $50,000 
D) It cannot be determined. 
A) $350,000 
B) $500,000 
C) $50,000 
D) It cannot be determined. B

Question 4

How much return does a typical angel investor expect from his or her investment?

Accepted Answer

A) Angel investors have no expectation of return. 
B) double the amount invested within 2 years 
C) 10 times the investment in 5 years 
D) 3 times the investment within 3 years 
A) Angel investors have no expectation of return. 
B) double the amount invested within 2 years 
C) 10 times the investment in 5 years 
D) 3 times the investment within 3 years

Question 5

Which of the following is another term for convertible debt?

Accepted Answer

A) convertible bond 
B) convertible stock 
C) loan forgiveness 
D) revolving debt 
A) convertible bond 
B) convertible stock 
C) loan forgiveness 
D) revolving debt

Question 6

A study of 212 U.S.startups form the late 1990s and early 2000s showed that what percentage of the founders were no longer CEO after three years?

Accepted Answer

A) 50% 
B) 80% 
C) 20% 
D) 12% 
A) 50% 
B) 80% 
C) 20% 
D) 12%

Question 7

______ angels are individuals who have already started and successfully operated their own businesses.

Accepted Answer

A) Corporate 
B) Entrepreneurial 
C) Professional 
D) Enthusiast 
A) Corporate 
B) Entrepreneurial 
C) Professional 
D) Enthusiast

Question 8

If an entrepreneur receives $275,000 from venture capitalists in exchange for stock,what do the investors receive in return?

Accepted Answer

A) royalties from future sales 
B) equity in the business 
C) access to the first round of product 
D) guaranteed board appointments 
A) royalties from future sales 
B) equity in the business 
C) access to the first round of product 
D) guaranteed board appointments

Question 9

In 1979,the venture capital industry benefited from what action?

Accepted Answer

A) an economic boom 
B) the ability of a pension fund to invest in venture capital 
C) federal fund availability to entrepreneurs 
D) the ability of small businesses to offer stock 
A) an economic boom 
B) the ability of a pension fund to invest in venture capital 
C) federal fund availability to entrepreneurs 
D) the ability of small businesses to offer stock

Question 10

A/an ______ is a type of investor who uses his or her own money to provide funds to young startup private businesses run by entrepreneurs who are neither friends nor family.

Accepted Answer

A) seed investor 
B) bridge investor 
C) equity investor 
D) angel investor 
A) seed investor 
B) bridge investor 
C) equity investor 
D) angel investor

Question 11

Which type of angel is most likely to intervene if the business is not going well?

Accepted Answer

A) entrepreneur 
B) professional 
C) enthusiast 
D) micromanagement 
A) entrepreneur 
B) professional 
C) enthusiast 
D) micromanagement

Question 12

One of the main advantages of convertible debt is that it is attractive to investors because ______.

Accepted Answer

A) their risk of loss is minimized 
B) they will be repaid for the loan when the company is successful 
C) they may be entitled to discounts on the share price 
D) they will be the first to own stock in your company 
A) their risk of loss is minimized 
B) they will be repaid for the loan when the company is successful 
C) they may be entitled to discounts on the share price 
D) they will be the first to own stock in your company

Question 13

You and your cofounders have spent a year building and testing a home wireless system that is easy to install and will integrate media streaming from phones,television,and the Internet.You have tested the product on family and friends and built a prototype.You now need money to build a pilot test,creating 100 systems and placing them in a display at five selected stores.Identify the best source(s)of capital that you and your cofounders should seek (you will need $100,000).

Accepted Answer

As an early-stage company,and

Question 14

______ is a short-term loan that can be turned into equity when future financing is issued.

Accepted Answer

A) Convertible debt 
B) Angel funding 
C) A business loan 
D) An equity loan 
A) Convertible debt 
B) Angel funding 
C) A business loan 
D) An equity loan

Question 15

One of the main advantages of convertible debt is that it ______.

Accepted Answer

A) doesn't need money to be paid back 
B) removes the need for valuation 
C) is less expensive than other types of loans 
D) eliminates a need for venture capitalist funds 
A) doesn't need money to be paid back 
B) removes the need for valuation 
C) is less expensive than other types of loans 
D) eliminates a need for venture capitalist funds

Question 16

How often will additional funding be awarded by a VC,assuming the company is growing?

Accepted Answer

A) every 8 years 
B) every 10 years 
C) every year or two 
D) every 5 years 
A) every 8 years 
B) every 10 years 
C) every year or two 
D) every 5 years

Question 17

An entrepreneur is asking for $1 million for 30% of his company.What is the entrepreneur's post-money valuation?

Accepted Answer

A) $3.33 million 
B) $300,000 
C) $2 million 
D) it cannot be determined 
A) $3.33 million 
B) $300,000 
C) $2 million 
D) it cannot be determined

Question 18

Because they are investors,angel investors and venture capitalists do not usually have an exit plan.

Accepted Answer

A) True 
 B)False

Question 19

How far back can we track the history of venture capital?

Accepted Answer

A) to the dot com investments of the early 90s 
B) to venture capital startups in the 1980s 
C) to the 1958 Small Business Investment Act 
D) to early 20th-century investors such as the Rockefellers and the Bessemers 
A) to the dot com investments of the early 90s 
B) to venture capital startups in the 1980s 
C) to the 1958 Small Business Investment Act 
D) to early 20th-century investors such as the Rockefellers and the Bessemers

Question 20

When working with a venture capitalist,it is possible to be demoted within your own company.

Accepted Answer

A) True 
 B)False

What type of investment vehicle do venture capital money managers typically use?

Venture capital became more organized and professional with the 1946 creation of American Research and Development.

An investor offers $150,000 for 30% of the company.What is the post-money valuation of the company?

How much return does a typical angel investor expect from his or her investment?

Which of the following is another term for convertible debt?

A study of 212 U.S.startups form the late 1990s and early 2000s showed that what percentage of the founders were no longer CEO after three years?

______ angels are individuals who have already started and successfully operated their own businesses.

If an entrepreneur receives $275,000 from venture capitalists in exchange for stock,what do the investors receive in return?

In 1979,the venture capital industry benefited from what action?

A/an ______ is a type of investor who uses his or her own money to provide funds to young startup private businesses run by entrepreneurs who are neither friends nor family.

Which type of angel is most likely to intervene if the business is not going well?

One of the main advantages of convertible debt is that it is attractive to investors because ______.

______ is a short-term loan that can be turned into equity when future financing is issued.

One of the main advantages of convertible debt is that it ______.

How often will additional funding be awarded by a VC,assuming the company is growing?

An entrepreneur is asking for $1 million for 30% of his company.What is the entrepreneur's post-money valuation?

Because they are investors,angel investors and venture capitalists do not usually have an exit plan.

How far back can we track the history of venture capital?

When working with a venture capitalist,it is possible to be demoted within your own company.

Practicing Entrepreneurship

Activating an Entrepreneurial Mindset

Creating and Recognizing New Opportunities

Using Design Thinking

Building Business Models

Developing Your Customers

Testing and Experimenting With New Ideas

Developing Networks and Building Teams

Creating Revenue Models

Planning for Entrepreneurs

Anticipating Failure

Bootstrapping and Crowdfunding for Resources

Navigating Legal and Ip Issues

Engaging Customers Through Marketing

Supporting Social Entrepreneurship

Financial Statements and Projections for Startups

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Exam 13: Financing for Startups

What type of investment vehicle do venture capital money managers typically use?

Venture capital became more organized and professional with the 1946 creation of American Research and Development.

An investor offers $150,000 for 30% of the company.What is the post-money valuation of the company?

How much return does a typical angel investor expect from his or her investment?

Which of the following is another term for convertible debt?

A study of 212 U.S.startups form the late 1990s and early 2000s showed that what percentage of the founders were no longer CEO after three years?

______ angels are individuals who have already started and successfully operated their own businesses.

If an entrepreneur receives $275,000 from venture capitalists in exchange for stock,what do the investors receive in return?

In 1979,the venture capital industry benefited from what action?

A/an ______ is a type of investor who uses his or her own money to provide funds to young startup private businesses run by entrepreneurs who are neither friends nor family.

Which type of angel is most likely to intervene if the business is not going well?

One of the main advantages of convertible debt is that it is attractive to investors because ______.

______ is a short-term loan that can be turned into equity when future financing is issued.

One of the main advantages of convertible debt is that it ______.

How often will additional funding be awarded by a VC,assuming the company is growing?

An entrepreneur is asking for $1 million for 30% of his company.What is the entrepreneur's post-money valuation?

Because they are investors,angel investors and venture capitalists do not usually have an exit plan.

How far back can we track the history of venture capital?

When working with a venture capitalist,it is possible to be demoted within your own company.

Practicing Entrepreneurship

Activating an Entrepreneurial Mindset

Creating and Recognizing New Opportunities

Using Design Thinking

Building Business Models

Developing Your Customers

Testing and Experimenting With New Ideas

Developing Networks and Building Teams

Creating Revenue Models

Planning for Entrepreneurs

Anticipating Failure

Bootstrapping and Crowdfunding for Resources

Navigating Legal and Ip Issues

Engaging Customers Through Marketing

Supporting Social Entrepreneurship

Financial Statements and Projections for Startups

The Pitch Deck

Filters