Management and Organizational Studies 1023A/B Study Guide - Final Guide: Private Equity Firm, Venture Capital Financing, Venture Capital

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1023A/B
• Professor: Maria Ferraro

Document Summary

New businesses seldom are started in large corporations large companies are efficient at producing goods and services and bringing them to the market, but they generally do not excel at incubating new businesses. Entrepreneurs often tell their ideas and make them operational through informal discussions with people whom the entrepreneur respects and trusts, such as friends and early investors. Bootstrapping: the p(cid:396)o(cid:272)ess (cid:271)(cid:455) (cid:449)hi(cid:272)h (cid:373)a(cid:374)(cid:455) e(cid:374)t(cid:396)ep(cid:396)e(cid:374)eu(cid:396)s (cid:396)aise (cid:862)seed(cid:863) (cid:373)o(cid:374)e(cid:455) a(cid:374)d o(cid:271)tai(cid:374) othe(cid:396) (cid:396)esou(cid:396)(cid:272)es (cid:374)e(cid:272)essa(cid:396)(cid:455) to sta(cid:396)t thei(cid:396) (cid:271)usi(cid:374)esses; (cid:862)to a(cid:272)(cid:272)o(cid:373)plish so(cid:373)ethi(cid:374)g o(cid:374) (cid:455)ou(cid:396) o(cid:449)(cid:374)(cid:863) The initial seed money usually comes from the entrepreneur (personal savings, selling assets) or other founders. Until the business gets started, entrepreneurs often work regular full-time jobs provides some cash flow. Other cash may come from family, friends, and loans obtained through credit cards. At this stage of business development, venture capitalists or banks are not normally willing to fund the business.