ACCY 302 DemandforGovernance.students

ACCY 302 DemandforGovernance.students -...

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The Demand for Governance: Venture Capital Funding
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Starting a new business When starting a new business, the entrepreneur often  needs money to get off the ground--  money to rent or  purchase space for the business, furniture, equipment,  supplies, etc.  S/he needs money to pay employees.
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Typical approaches  to funding a new business Personal savings Bootstrapping meaning, with a very small investment, you get the business going,  and then use the profits from each sale to grow the business.  This  approach works well in the service industry where start-up expenses  are sometimes low and you don’t need employees initially. Bank loan All three of these techniques have limitations unless you are already a wealthy individual.
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Angel funding Angel investors are individuals who invest in businesses looking for a higher  return than they would see from more traditional investments. Usually they are  the bridge from the self-funded stage of the business to the point that the needs of  the business require the level of funding that a venture capitalist would offer.   Angel funding estimates vary, but usually range from $150,000 to $3 million.  Venture capital funding Venture capitalists are firms that typically open a fund into which it gathers  money from wealthy individuals and from companies, pension funds, etc. that  have money they wish to invest.  These firms then seek out companies in which it  believes can generate high returns if it were to invest.
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This note was uploaded on 11/08/2011 for the course ACCY 301 taught by Professor Staff during the Fall '08 term at University of Illinois, Urbana Champaign.

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ACCY 302 DemandforGovernance.students -...

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