Objectives
- Explain why most entrepreneurial ventures need to raise money during their early life.
- Identify the three sources of personal financing available to entrepreneurs.
- Provide examples of how entrepreneurs bootstrap to raise money or cut costs.
- Identify the three steps involved in properly preparing to raise debt or equity financing.
- Discuss the difference between equity funding and debt financing.
Why New Ventures Need Financing
Personal Financing
Personal Funds
-->The vast majority of founders contribute personal funds, along with sweat equity, to their ventures.
-->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.
-->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.
