Exam 10: Getting Financing or Funding

Venture capital is money that is invested by venture-capital firms in start-ups and small businesses with exceptional growth potential.

Approximately 20 percent of the 9,000 banks in the United States participate in the SBA Guaranteed Loan Program.

What is a business angel? Describe the prototypical business angel. How much money do business angels typically invest in a single company?

In regard to the stages (or rounds) of venture capital funding, the stage of funding that occurs when an investment is made very early in a venture's life to fund the development of a prototype and feasibility analysis is referred to as:

Which of the following is not a source of equity funding?

According to the textbook, many entrepreneurs go about the task of raising capital haphazardly because:

Venture capitalists fund about ________ companies per year.

Kimberly Jones is the founder of a company in the medical equipment industry. Kimberly'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 Kimberly's:

Typically, the seen money that gets a company off the ground comes from a commercial bank.

A brief carefully constructed statement that outlines the merits of a business opportunity is called an:

Which of the following statements is not correct regarding the SBA 7(A) Loan Guaranty Program?

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

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

The first sale of stock by a firm to the public is referred to as an:

The three most common forms of equity funding are:

The SBA 7(A) Guaranty loan program is available to:

The major advantages of leasing is that:

Which "phase" of the SBIR Program is intended to demonstrate the proposed innovation's technical feasibility?

The are three common sources of "personal" financing for a start-up firm: personal funds, friends and family, and bootstrapping.

For startup firms, some products are under development for years before they generate earnings. The up-front costs often exceed a firm's ability to fund these activities on its own. Which of the following reasons that motivate firms to seek funding or financing is illustrated in this example?