Exam 12: Entrepreneurial Finance

The core concept in determining the external financing requirements of a venture is ____.

New and emerging companies are gluttons for capital,yet are usually not very debt worthy.

An entrepreneur's bargaining power with various sources of equity and debt capital is influenced by the cash flow of the venture.

What are the three core principles of entrepreneurial finance?

_____ borrowings are used to finance the purchase of property or equipment that serves as collateral for a loan.

Earnings before interest and taxes (EBIT) Less Tax exposure (tax rate times EBIT) Plus Depreciation,amortization,and other noncash charges Less Increase in operating working capital Less Capital expenditures. This formula is used to calculate ____.

Banks are typically willing to provide long-term debt to new ventures if the business has a substantial asset base of property and equipment.

A fund-raising strategy commits a company to actions that may have an impact on future financing options.

What are the three vital corollaries determining the external financing requirement of a venture?

How is the increase in net total operating capital calculated?

What phenomenon is at the heart of the financing challenges faced by new and high revenue growth companies?

Which critical issue faced by entrepreneurs is concerned with the constituencies for whom value must be created or added to achieve a positive cash flow?

The date a company runs out of money is called ____.

Strategies that optimize or maximize the amount of money to be raised decrease risk in new and emerging companies.

An existing business seeking expansion capital or funds for temporary use has a much easier job obtaining both debt and equity.

All underlying characteristics and assumptions used by popular financial theories and models do not hold up for startups,even up to an IPO.

What funding structure provides a sound financial foundation for growth without excessive dilution of an entrepreneur's equity?

Discuss the premise behind fund-raising strategies of a successful entrepreneur.

Lack of financial know-how and unanticipated issues are often the entrepreneurs' Achilles' heels.

_____ is used to fill the nonbankable cash gaps where money cannot be borrowed,preserve ownership,and lower the risk of loan defaults.