Exam 10: Getting Financing or Funding

Amy Clark just opened a soup and salad restaurant near Golden Gate Park in San Francisco, CA. Rather than borrow money or raise funds from investors, Amy used her creativity and ingenuity and figured out how to get her business up and running without the need for external funding. Amy is utilizing a technique referred to as ________.

Debt financing means exchanging partial ownership in a firm in exchange for cash.

Kinvolved, the company profiled in the opening feature of Chapter 10, is an EdTech startup that involves an app to track student absences. The company was co-founded by Miriam Altman and Alexandra Meis. Which of the following is true about Kinvolved's founding story?

The first sale of stock by a firm to the public is referred to as a(n) ________.

________ are individuals who invest their personal capital directly in start-ups.

The three primary reasons startups need funding are ________.

Equity financing (or funding) means ________.

The most notable SBA program available to small businesses is the ________.

Venture capitalists are individuals who invest their personal capital directly in startups.

What is the difference between equity funding and debt financing? What are the most common sources of equity funding and debt financing?

Equity investors typically have a ________ year investment horizon.

According to our textbook, the seed money that gets a company off the ground typically comes from ________.

Courtney Young is the founder of a company in the semiconductor industry. Courtney's firm is still in the feasibility analysis stage and doesn't have a product that is ready to sell. The company is spending about $25,000 per month and expects to maintain that level of spending until it reaches profitability. The $25,000 a month is Courtney's ________ rate.

What is meant by the term "bootstrapping"? Provide several examples of the ways that entrepreneurs bootstrap to raise money or cut costs?

Which of the following statements is incorrect regarding equity funding?

The number of angel investors in the United States has decreased dramatically over the past decade.

What is an elevator speech? How did it get its name?

A(n) ________ bank is an institution, such as Credit Suisse First Boston, that acts as an underwriter or agent for a firm engaged in an initial public offering.

In 2015, venture capital firms funded nearly ________ deals.

Which of the following statements is NOT correct regarding business angels?