MKT 5815 Seed Money Analysis Brendan O’Neal

MKT 5815 Seed Money Analysis Brendan O’Neal...

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Brendan O’Neal October 29, 2010 Funding New Start Up Ventures Dr. Gene Landrum Hodges University
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Funding New Start Up Ventures Funding a new start-up may be a difficult task, but it is required in order to get the venture off of the ground (Goel and Hasan, 2004). To the budding entrepreneur, this sounds like a daunting, difficult, and almost impossible task due to the very nature of the task. The entrepreneur is asking for money to fund a business or venture that is not proven and is not yet tangible. Start-ups get their funds from family or friends, angels, venture capitalists, or through financing through loans (Landrum, 2010). There are other ways of financing a start up organization, but these will be explored through the paper. A lot of start-ups get their funding from family or friends; these individuals are usually high-income individuals that have invested and saved their money (Landrum, 2010). There are some advantages to getting the money from friends and family; one of the advantages is that they are easy to find and communicate with. There are several disadvantages that come with this. These disadvantages include mixing business with one’s personal life; family and friends may not be as resourceful or have as big of a network as an angel investor or a venture capitalist firm. Angel investors are essentially individuals that have a high amount of income, are wealthy, and have the funds readily available in a liquid form to disburse to the organization as an investment. These are often professionals in real estate, doctors, lawyers, or other professional position holders (Landrum, 2010). The best angels may be
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MKT 5815 Seed Money Analysis Brendan O’Neal...

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