Chapters 5-6: Starting And Structuring A Business Flashcards
What is a small business?
Independently owned and operated, not dominant in a field and less that 500 employees.
What is the SBA?
Small Business Administration
What does the SBA do?
Aid, counsel, assist, and protect the interests of small businesses`
What is an Entrepreneur?
Someone who assumes the risk of creating, organizing, and operating a business
What is a Lifestyle Entrepreneur?
Look for businesses that matches their desired lifestyle
What is a Micropreneur?
Satisfied with keeping the business small to achieve a balanced lifestyle
What is a Home-based Entrepreneur?
Run their businesses out of their homes
What is an Internet Entrepreneur?
Run their businesses strictly online
What is a Growth Entrepreneur?
Strive to create fast growing businesses and look forward to expansion
What is a Social Entrepreneur?
Start businesses with a social mission in mind
What is a Intrapreneur?
Ones who work in an entrepreneurial way with-in organizations owned by other people
What is a serial entrepreneur?
Create and grow many different businesses over their business career
What is a Franchise?
Sells a company’s products or services under the company’s name to independent third party operators
What is a Business Plan?
Outlines the goals and strategies of a company including its marketing plans financial forecast, risk analysis, and operational plan
What is S.C.O.R.E?
Volunteers provide free assistance b viewing business plans, helping with tax planning, and offering new ideas and fresh insights.
What are Business Incubators?
Support start up businesses by offering resources such as administrative, technical and networking sources
What are advisory boards?
Offer guidance to new business owners, but they generally do not have authority to make decisions
What are enterprise zones?
Geographic areas targeted for economic revitalizing by state and federal governments
What are Grants?
Financial awards offered by federal and state governments and some private organizations
What is an Angel Investor?
Wealthy individuals who are looking to invest in interesting businesses with good prospects for growth and returns
What is a Venture Capitalist?
Invest in a business in return for some form of equity or ownership in the business
What is a Sole Proprietorship?
Business owned and usually operated by a single individual
What are some advantages of a Sole Proprietorship?
No formal legal requirements for starting, and revenues and expenses are reported directly on the business owners personal tax return
Name a disadvantage of Sole Proprietorship?
Personal and business assets are at risk in the event of a business catastrophe
What is a Partnership?
Business structure where two or more individuals share aspects of the business including its financial management and sales and marketing. Income and expenses flow directly through each partners tax return
What is a Partnership Agreement?
Formal document that outlines the responsibilities of each partner and how the business’s profits will be divided and disputes will be settled
What is a General Partnership?
Arrangement in which all partners have equal liability
What is a Limited Partnership?
Some partners do not participate in the daily ops of the business and liabiliy is limited to the amount of capital they contributed
What is a Limited Liability Partnership? (LLP)
Protect partners from any debt or liability incurred by a business as well as each partner from the liability of another partner
What is a Corporation?
Businesses structured as separate legal entities
What is a CEO?
Chief Executive Officer
What are the duties of the CEO?
Responsible for the entire operations of the corporation and reports directly to the board of directors
What is a CFO?
Chief Financial Officer
What are the duties of the CFO?
Reports directly to the CEO and is responsible for analyzing and reviewing the businesses financial data
What is COO?
Chief Operating Officer
What are the duties of a COO?
Responsible for the day-to-day operations of the organization and reports directly to the CEO
What are First-line Managers?
People who directly supervise lower-level employees and help run the business
What is a S Corporation?
Have shareholders and must comply with all other regulations involving traditional C Corporations
What is a C Corporation?
Under IRS Sub-chapter C and can be structured as a S Corporation
What is a Limited Liability Company? (LLC)
Offers the protections of limited liability like an S Corporation does but have a unlimited member base
What is a Not-for-Profit Organization?
Corporations whose purpose is to serve the public interest rather that to seek to make a profit
Define Cooperatives.
Businesses that are owned not by outside investors but are governed by members who use its products and services
What is Synergy?
Effect achieved when two companies combine and the result is better that each company could achieve individually
What is Acquisition?
Occurs when one company buys another outright
What is a Merger?
Occurs when two or more companies of similar size mutually agree to combine to form a new company
What is a Horizontal Merger?
Two companies that share the same product lines and are in direct competition with each other merge
What is a Vertical Merger?
Two companies that have a company/customer relationship or a company/supplier relationship merge
What is a Product Extension Merger?
Two companies selling different but related products in the same market merge
What is a Market Extension Merger?
Two companies that sell the same products in different markets merge
What is a Conglomeration?
Two companies that have no common business areas merge to obtain diversification
