Term 2 Topic 2.4 - Setting up/starting a business Flashcards
Provide the term of the following:
Money from the owners of the business
Equity capital
Provide the term of the following:
Money borrowed that must be repaid
loans
Provide the term of the following:
The money OWED on the loans taken
debt
Provide the term of the following:
Money borrowed from the bank to COVER costs in your bank acc
overdraft
Provide the term of the following:
Buying on account from a SUPPLIER and paying later
trade credit
Provide the term of the following:
Selling your DEBTORS to another business at a discount
factoring
Provide the term of the following:
Money from government or NGO’s for a specific use
grants
Provide the term of the following:
Paying for the use of an asset on a monthly basis
leasing
Provide the term of the following:
Money raised from buying shares in a business
venture capital
What are the THREE main stages of:
> > > a business VENTURE
1) Concept: the business plan
2) Planning: the action plan
3) Realisation: making the plans a reality
You can start a business venture in 2 ways. Name them
a) indepdendently (doing it all by yourself)
b) collaboratively(doing it with other people)
What factors do you need to consider when you are setting up a business venture?
- SIZE of the business
- CULTURE of the business
- RISKS involved in setting up
- influences from the MACRO environment
- market RESEARCH needed
- skilled staff and TRAINING needed
Name the 2 ways you can acquire funding to start a business
1) Main sources
2) Other sources
What are the MAIN sources of acquiring funding for a new business?
- Equity capital
- Loans
- Debt
What are the OTHER sources of acquiring funding for a new business?
$ Trade credit
$ Overdraft
$ Grants
$ Venture capital
$ Leasing
$ Factoring