Transcript CHAPTER24.PPT

Money Needs
Kinds of money needed
24.1
Seed money
Entrepreneur, angels
Start-up capital
Entrepreneur, angels
Working capital
Bank
Growth capital
Venture capitalist, IPO,
retained earnings
™
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
PLANNING AND GROWING A BUSINESS VENTURE™
Debt
Forms of debt
• Direct loans
• Suppliers
• Leasing
• Bonds
• Credit cards
24.2
™
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
PLANNING AND GROWING A BUSINESS VENTURE™
Equity
• Corporation structure allows the right
to sell equity
• Equity entitles owner
to profit from company
• Equity is a common
way to raise money
• Investor and owner
preferences determine
use of equity
24.3
™
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
PLANNING AND GROWING A BUSINESS VENTURE™
Financial Strategy
Balancing Debt vs. Equity
Equity
Debt
Leases
Suppliers
Loans
Bonds
Credit Cards
Other Debt
24.4
Selling Stock
Outside investors
Retained earnings
™
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
PLANNING AND GROWING A BUSINESS VENTURE™