Sources of Financing
30 Questions
0 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to Lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What are the two main sources of finance for a business?

  • Short-term and long-term investments
  • Seed capital and seed funding
  • Owner's capital and retained profit
  • Internal and external (correct)

Which type of finance is considered the cheapest for an organization?

  • Seed financing
  • Internal finance (correct)
  • Owner's capital
  • External finance

What does seed financing represent in the capital-raising process of a startup?

  • An internal source of finance
  • The earliest stage of capital-raising (correct)
  • A type of debt-based financing
  • The final stage of capital-raising

Which of the following is an example of an internal source of finance?

<p>Owner's capital (C)</p> Signup and view all the answers

Where do external sources of finance typically come from?

<p>Individuals or sources outside the business (B)</p> Signup and view all the answers

What distinguishes seed financing from other types of financing?

<p>Investors receive equity interest in a company (B)</p> Signup and view all the answers

What is the purpose of seed financing?

<p>To give a founding team enough capital to prove if a concept works (B)</p> Signup and view all the answers

According to Marc Andreessen, what does 'product/market fit' mean?

<p>Being in a good market with a product that can satisfy that market (D)</p> Signup and view all the answers

Who typically provides seed financing?

<p>Crowdfunding (C)</p> Signup and view all the answers

What is the purpose of crowdfunding in financing startups?

<p>Raising money from a large number of people via the internet (A)</p> Signup and view all the answers

What is another term used for founders using their personal savings to fund a startup?

<p>Bootstrapping (A)</p> Signup and view all the answers

What do online crowdfunding platforms like Kickstarter do when a project reaches its fundraising goal?

<p>Stop collecting more money (B)</p> Signup and view all the answers

What is one of the benefits of personal savings for financing a startup?

<p>Independence from investors and loans (A)</p> Signup and view all the answers

Who typically contributes to the Friends and Family round of financing?

<p>Close friends and family members (B)</p> Signup and view all the answers

What characterizes angel investors?

<p>Diversify their investment portfolio (B)</p> Signup and view all the answers

What is a key benefit of Seed Financing for a startup?

<p>Providing funds before the business starts earning (C)</p> Signup and view all the answers

What is the primary purpose of Start-up Financing?

<p>Providing capital at the initial stage (D)</p> Signup and view all the answers

Which source of financing reduces the risk for founders by providing working capital?

<p>Seed Financing (B)</p> Signup and view all the answers

What is a startup accelerator?

<p>A program providing guidance, support, and funding in return for equity (C)</p> Signup and view all the answers

What is the main purpose of attracting additional investors in this stage?

<p>To generate long-term profits (B)</p> Signup and view all the answers

What distinguishes super angel investors from regular angel investors?

<p>Super angels invest larger amounts and provide mentoring support (D)</p> Signup and view all the answers

What is typically expected of businesses at the stage before they begin advertising and marketing their products?

<p>Have a prototype to show investors (C)</p> Signup and view all the answers

Why do businesses need a larger infusion of cash at the stage mentioned?

<p>To complete product development and support business launch (A)</p> Signup and view all the answers

What should businesses demonstrate at the stage mentioned despite having enthusiastic users?

<p>How they will monetize their product for long-term profits (A)</p> Signup and view all the answers

What is the main source of funding for CVC?

<p>Large corporates (C)</p> Signup and view all the answers

What defines a family office?

<p>Company managing wealth for a wealthy family (B)</p> Signup and view all the answers

When does Late Stage Venture Capital typically occur?

<p>After a company proves market opportunity (C)</p> Signup and view all the answers

What do investors look for in First-round Financing?

<p>Performance and evidence of commercially viable product/service (A)</p> Signup and view all the answers

How do Performance metrics impact investor confidence?

<p>They give investors confidence in the team's ability to succeed at scale (D)</p> Signup and view all the answers

What distinguishes Start-up Financing investors from First-round Financing investors?

<p>Investment stage preferences (C)</p> Signup and view all the answers

More Like This

Sources of Finance
49 questions

Sources of Finance

RevolutionaryPhiladelphia7463 avatar
RevolutionaryPhiladelphia7463
Use Quizgecko on...
Browser
Browser