Importance Of Finance

Question 1

Eight forms of finance for small enterprises

Answer 1

Personal resources 
venture capital companies
commercial banks 
micro finance 
crowdfunding 
Philanthropy venture capital 
government financing 
capital markets

Question 2

What are personal resources

Answer 2

Savings and Fonz borrowed from family

Question 3

What are the positives regarding personal resources

Answer 3

Usually interest-free

Question 4

What are venture capital companies

Answer 4

Small companies or individuals that are best directly to enterprises

Question 5

What do you venture capitalist company is usually require to invest

Answer 5

Representation on the board

Question 6

What are the negative regarding venture capital companies

Answer 6

Loss Of control

Question 7

What are micro finance

Answer 7

Financial resources to offer loans savings insurance

Question 8

Where is micro finance in popular

Answer 8

Developing countries

Question 9

What two types of micro finance are there

Answer 9

Government regulated providers and informal finance providers

Question 10

Why are informal finance providers risky

Answer 10

They operate outside government regulations

Question 11

What are the positives regarding micro financing

Answer 11

People are seen as members and lone to each other

Question 12

What is a big negative regarding micro financing

Answer 12

High interest rates especially when loans have been defaulted

Question 13

What is crowdfunding

Answer 13

Findings in from individuals or groups over the Internet derived from small entrepreneurial individuals and teams

Question 14

What sort of capital does crowdfunding provide

Answer 14

Start up and working capital

Question 15

What are the negatives regarding crowdfunding

Answer 15

Not much due diligence

Question 16

What are the positive regarding crowdfunding

Answer 16

Owners keep control of their business

Question 17

What is for philanthropic venture capital

Answer 17

Finance that is usually provided for social enterprises by high net worth individual’s

Question 18

Apart from finance what else does philanthropy venture capital provide for small businesses

Answer 18

Advice and engagement

Question 19

What is government financing

Answer 19

Tax allowances loans grants and training allowances all to encourage small enterprises

Question 20

What are capital market financing

Answer 20

Companies listed plc and trading stocks and shares

Question 21

What is the alternative investment market

Answer 21

A capital market for small businesses to sell stocks and shares and is less expensive

Question 22

In regards to financing what is the enterprise life-cycle

Answer 22

Concept 
start up 
early-stage 
establishment
 growth 
or exit

Question 23

What is the finance needed to go from concept to start a business

Answer 23

Seed capital usually got in from personal resources

Question 24

What is seed capital mainly used for

3

Answer 24

Market research
product research
development plan

Question 25

What is bootstrapping

Answer 25

Starting a business with a few resources and take control of costs usually reinvested into the business

Question 26

At what stage of the enterprise life-cycle is bootstrapping usually used

Answer 26

Concept to start up

Question 27

And enterprise life-cycle what a start-up business use are concerned with

Answer 27

Entering market and survival

Question 28

What do you start a business need finance for

Answer 28

Be able to operate for six months

Question 29

Where do you start up businesses usually get their finance from

Answer 29

Family and friends

Question 30

Why are our bank loans hard to get for start-up businesses

Answer 30

The business has no track record

Question 31

How do most early stage businesses finance

Answer 31

Internal funds

Question 32

What are venture capitalist looking for in early stage businesses to finance

Answer 32

Growth potential

Question 33

At the establishment stage in businesses finance depends on two strategic objective’s

Answer 33

Deciding on whether to expand into new markets or diversifying products

Question 34

Why is funding more likely in establishment stage businesses

Answer 34

The risks are better understood

Question 35

What is the growth choice for growth establishment the businesses. 3

Answer 35

Maintain market share reduce costs by increasing scale of operations defence against competition

Question 36

In the exit stage of enterprise life-cycle how does capital in released as a reward 3

Answer 36

Trade sale management buyout initial public offering