COMM 320 Chapter Notes - Chapter 10: Cash Flow, Crowdfunding, Underwriting
23 Oct 2016
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Few people deal with the process of raising investment capital until they need to raise capital for their own firm. As a result, many entrepreneurs go about the task of raising capital haphazardly because they lack experience in this area. There are three reasons most new ventures need to raise money during their early life: why most new ventures need funding. Sweat equity represents the value of the time and effort that a founder puts into a new venture: friends and family: friends and family are the second source of funds for many new ventures. Bootstrapping is finding ways to avoid the need for external financing or funding through creativity, ingenuity, thriftiness, cost cutting, or any means necessary. Avoid unnecessary expenses, such as lavish office space or furniture. Buy items cheaply, but prudently, through discount outlets or online auctions such as ebay, rather than at full-price stores. Share office space or employees with other businesses.
