Question 1

______ is the company's value after it receives a round of financing.

Accepted Answer

A) Post-money valuation 
B) Seed money valuation 
C) Pre-money valuation 
D) Startup valuation 
A) Post-money valuation 
B) Seed money valuation 
C) Pre-money valuation 
D) Startup valuation

Question 2

______ is provided to build the team and test the product or service.

Accepted Answer

A) Startup loans 
B) Seed-stage financing 
C) Startup financing 
D) Early-stage financing 
A) Startup loans 
B) Seed-stage financing 
C) Startup financing 
D) Early-stage financing

Question 3

A company has a value of $400,000 and is looking for $500,000 in order to move into other markets and build the production capability to do so.What is the most likely source of funding?

Accepted Answer

A) family and friends 
B) IPO 
C) angel investor 
D) venture capitalist 
A) family and friends 
B) IPO 
C) angel investor 
D) venture capitalist

Question 4

What two sources of investors are available for a private company?

Accepted Answer

A) accredited investors and family/friends 
B) family/friends and shareholders 
C) investors and family/friends 
D) investors and banks 
A) accredited investors and family/friends 
B) family/friends and shareholders 
C) investors and family/friends 
D) investors and banks

Question 5

Generally speaking, there are more minority angel funding groups than women angel groups.

Accepted Answer

A) True 
 B)False

Question 6

When seeking investors, the authors suggest which of the following?

Accepted Answer

A) Find investors early in the game so that you can focus on building the company. 
B) Avoid seeking investors as long as possible. 
C) Wait until the company is financially successful, then use the funds for growth. 
D) Avoid investors altogether. 
A) Find investors early in the game so that you can focus on building the company. 
B) Avoid seeking investors as long as possible. 
C) Wait until the company is financially successful, then use the funds for growth. 
D) Avoid investors altogether.

Question 7

Assume that you are an entrepreneur faced with giving up 20% of your company in exchange for venture capital.What factors would you consider in accepting this offer?

Accepted Answer

Answers should focus on the pre- and pos

Question 8

Karen has formulated a line of green cleaning products, which she has tested with local commercial entities with great results.She is now ready to seek money to place the product in stores.What stage of financing is Karen interested in?

Accepted Answer

A) seed stage financing 
B) startup financing 
C) early-stage financing 
D) continuity financing 
A) seed stage financing 
B) startup financing 
C) early-stage financing 
D) continuity financing

Question 9

As a general theme for this chapter, what sequence should an investor take when seeking financial support for his or her startup?

Accepted Answer

A) family and friends, angel investor, venture capitalists, IPO 
B) angel investors, family and friends, venture capitalists 
C) family and friends, angel investors, IPO 
D) angel investors, venture capitalists, IPO 
A) family and friends, angel investor, venture capitalists, IPO 
B) angel investors, family and friends, venture capitalists 
C) family and friends, angel investors, IPO 
D) angel investors, venture capitalists, IPO

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

The cofounders for Contap received $275,000 from venture capitalists.What did the investors receive in return?

Accepted Answer

A) 5% royalties from future sales 
B) 15% equity in the business 
C) 50% equity in the business 
D) 10% royalties from future sales 
A) 5% royalties from future sales 
B) 15% equity in the business 
C) 50% equity in the business 
D) 10% royalties from future sales

Question 12

One of the dangers of seeking financing too early is that you may give investors more equity than you should.

Accepted Answer

A) True 
 B)False

Question 13

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 14

Which of the following describes an angel group?

Accepted Answer

A) a group formed from entrepreneur and professional angels 
B) a group of investors who listen to your pitch as a group 
C) a group of angels who share knowledge and collaborate in their investments 
D) an angel who invests on behalf of others 
A) a group formed from entrepreneur and professional angels 
B) a group of investors who listen to your pitch as a group 
C) a group of angels who share knowledge and collaborate in their investments 
D) an angel who invests on behalf of others

Question 15

An entrepreneur is looking for funds to form a prototype and pitch the product.Which of the following should NOT be considered at this stage?

Accepted Answer

A) crowdfunding 
B) family and friends 
C) personal loans 
D) venture capitalists 
A) crowdfunding 
B) family and friends 
C) personal loans 
D) venture capitalists

Question 16

Even though you may not be profitable, investors will want to know how many customers you have because it will show potential ______.

Accepted Answer

A) customer satisfaction 
B) to scale the business 
C) marketability 
D) revenue from that base 
A) customer satisfaction 
B) to scale the business 
C) marketability 
D) revenue from that base

Question 17

Sites such as ______ will help you find out how much businesses are worth in your industry.

Accepted Answer

A) Indeed.com 
B) SBA.gov 
C) Entrepreneur.com 
D) BizBuySell 
A) Indeed.com 
B) SBA.gov 
C) Entrepreneur.com 
D) BizBuySell

Question 18

Venture capitalists work with investment portfolios.What does this mean?

Accepted Answer

A) the capitalists invest in more than one company at a time 
B) details are kept for ready access about all company information 
C) they have a defined type of business(es) they would like to invest in 
D) they have a list of investors on behalf of whom they invest 
A) the capitalists invest in more than one company at a time 
B) details are kept for ready access about all company information 
C) they have a defined type of business(es) they would like to invest in 
D) they have a list of investors on behalf of whom they invest

Question 19

The experience of the cofounders and previous successes will influence an investor's willingness to invest in your company

Accepted Answer

A) True 
 B)False

Question 20

Even if the venture capital does not come through, what can be gained from the relationship?

Accepted Answer

A) the relationship can lead to future funding or additional funding contacts 
B) you will discover the skeletons in your closet 
C) you will gain valuable experience 
D) you will learn how to prepare a better portrait of your company 
A) the relationship can lead to future funding or additional funding contacts 
B) you will discover the skeletons in your closet 
C) you will gain valuable experience 
D) you will learn how to prepare a better portrait of your company

______ is the company's value after it receives a round of financing.

______ is provided to build the team and test the product or service.

A company has a value of $400,000 and is looking for $500,000 in order to move into other markets and build the production capability to do so.What is the most likely source of funding?

What two sources of investors are available for a private company?

Generally speaking, there are more minority angel funding groups than women angel groups.

When seeking investors, the authors suggest which of the following?

Assume that you are an entrepreneur faced with giving up 20% of your company in exchange for venture capital.What factors would you consider in accepting this offer?

Karen has formulated a line of green cleaning products, which she has tested with local commercial entities with great results.She is now ready to seek money to place the product in stores.What stage of financing is Karen interested in?

As a general theme for this chapter, what sequence should an investor take when seeking financial support for his or her startup?

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

The cofounders for Contap received $275,000 from venture capitalists.What did the investors receive in return?

One of the dangers of seeking financing too early is that you may give investors more equity than you should.

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

Which of the following describes an angel group?

An entrepreneur is looking for funds to form a prototype and pitch the product.Which of the following should NOT be considered at this stage?

Even though you may not be profitable, investors will want to know how many customers you have because it will show potential ______.

Sites such as ______ will help you find out how much businesses are worth in your industry.

Venture capitalists work with investment portfolios.What does this mean?

The experience of the cofounders and previous successes will influence an investor's willingness to invest in your company

Even if the venture capital does not come through, what can be gained from the relationship?

Entrepreneurship: a Global Social Movement

Practicing Entrepreneurship

Developing an Entrepreneurial Mindset

Supporting Social Entrepreneurship

Generating New Ideas

Using Design Thinking

Testing and Experimenting in Markets

Building Business Models

Planning for Entrepreneurs

Creating Revenue Models

Learning From Failure

Bootstrapping for Resources

Developing Networks

Navigating Legal and Ip Issues

Marketing and Pitching Your Idea

Financial Statements and Projections for Startups

the Pitch Deck

Filters

Exam 13: Financing for Startups

______ is the company's value after it receives a round of financing.

______ is provided to build the team and test the product or service.

A company has a value of $400,000 and is looking for $500,000 in order to move into other markets and build the production capability to do so.What is the most likely source of funding?

What two sources of investors are available for a private company?

Generally speaking, there are more minority angel funding groups than women angel groups.

When seeking investors, the authors suggest which of the following?

Assume that you are an entrepreneur faced with giving up 20% of your company in exchange for venture capital.What factors would you consider in accepting this offer?

Karen has formulated a line of green cleaning products, which she has tested with local commercial entities with great results.She is now ready to seek money to place the product in stores.What stage of financing is Karen interested in?

As a general theme for this chapter, what sequence should an investor take when seeking financial support for his or her startup?

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

The cofounders for Contap received $275,000 from venture capitalists.What did the investors receive in return?

One of the dangers of seeking financing too early is that you may give investors more equity than you should.

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

Which of the following describes an angel group?

An entrepreneur is looking for funds to form a prototype and pitch the product.Which of the following should NOT be considered at this stage?

Even though you may not be profitable, investors will want to know how many customers you have because it will show potential ______.

Sites such as ______ will help you find out how much businesses are worth in your industry.

Venture capitalists work with investment portfolios.What does this mean?

The experience of the cofounders and previous successes will influence an investor's willingness to invest in your company

Even if the venture capital does not come through, what can be gained from the relationship?

Entrepreneurship: a Global Social Movement

Practicing Entrepreneurship

Developing an Entrepreneurial Mindset

Supporting Social Entrepreneurship

Generating New Ideas

Using Design Thinking

Testing and Experimenting in Markets

Building Business Models

Planning for Entrepreneurs

Creating Revenue Models

Learning From Failure

Bootstrapping for Resources

Developing Networks

Navigating Legal and Ip Issues

Marketing and Pitching Your Idea

Financial Statements and Projections for Startups

the Pitch Deck

Filters