Chapter 9

Question 1

Angel Investors

Answer 1

An investor who provides financial backing for small startups or entrepreneurs.

Question 2

Asset Base for Loans

Answer 2

A business loan secured by collateral (assets). The loan, or line of credit, is secured by inventory, accounts receivable and/or other balance-sheet assets.

Question 3

Bank Loans

Answer 3

loan from a bank

Question 4

Bootstrapping

Answer 4

A type of self funding often applied in a small business can reduce cost from the current operation and overhead

Question 5

Collateral

Answer 5

something pledged as security for repayment of a loan, to be forfeited in the event of a default.

Question 6

Credit Cards

Answer 6

A card issued by a financial company giving the holder an option to borrow funds, usually at point of sale. Credit cards charge interest and are primarily used for short-term financing.

Question 7

Debt financing

Answer 7

when a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay principal and interest on the debt.

Question 8

Factors(ing)

Answer 8

Private lenders that provide funds for your operations using purchase orders as a security for the loan. They loan only a percentage of the sales orders and charge very high interest rights.

Question 9

Family & Friends

Answer 9

very popular source of funding for startups because they are not worried about quick profits.

Question 10

IPO

Answer 10

the first sale of stock by a company to the public. A company can raise money by issuing either debt or equity. If the company has never issued equity to the public, it’s known as an IPO. Companies fall into two broad categories: private and public.

Question 11

Lean startup

Answer 11

Lean startup is an approach to business development that is based on the principles of lean production, a manufacturing methodology that values a business’ ability to change quickly.

Question 12

Leasing

Answer 12

A legal document outlining the terms under which one party agrees to rent property from another party. A lease guarantees the lessee (the renter) use of an asset and guarantees the lessor (the property owner) regular payments from the lessee for a specified number of months or years.

Read more: http://www.investopedia.com/terms/l/lease.asp#ixzz3Xza3YCkz
Follow us: @Investopedia on Twitter

Question 13

Line of Credit

Answer 13

an amount of credit extended to a borrower.

Question 14

Minority-Owned Business

Answer 14

a business which is at least 51% owned, operated and controlled on a daily basis by one or more (in combination) American citizens of the following ethnic minority and/or gender (e.g. woman-owned) and/or military veteran classifications:

Question 15

SBA Loans

Answer 15

The US Small Business Administration 504 Loan or Certified Development Company program is designed to provide financing for the purchase of fixed assets, which usually means real estate, buildings and machinery, at below market rates.

Question 16

SBIR Grant

Answer 16

provide funds to small businesses to develop new technologies

Question 17

Self-funding

Answer 17

Assuming full responsibility for funding a project.

Question 18

Trade IP Rights

Answer 18

an international agreement administered by the World Trade Organization (WTO) that sets down minimum standards for many forms of intellectual property (IP) regulation as applied to nationals of other WTO Members.

Question 19

Virtual Compnay

Answer 19

employs electronic means to transact business as opposed to a traditional brick and mortar business that relies on face-to-face transactions with physical documents and physical currency or credit.