Purchase Solution

Sources of Financing for a growth stage firm

Not what you're looking for?

Ask Custom Question

Can you guide me on this short assignment? Include any references.

All small business owners find themselves looking for small business funding at one point or another. In this simulation you are preparing to seek funding from venture capitalist, but there are many other sources of funding to consider. The small business owner must determine how these sources marry with company vision, mission and values, and weigh the advantages and disadvantages of each funding source. For this discussion question you will conduct research on these funding sources and:

1.Present a high level overview of at least 4 types of sources.

2.Select the top 2 sources that you think would be a best fit for the growth stage of your business.

3.Discuss how you would identify specific companies/individuals within these 2 choices to find one that is the most compatible with your organizations values.

4.Cite one example of a company that has achieved this goal

Purchase this Solution
Solution Summary

Discusses source of financing for a growth stage firm.

Solution Preview

The first source of financing for this growth stage firm would be individual high net worth individuals. The firm can raise equity capital from high net worth individuals by diluting owner's equity. The main advantage is that the equity capital will not invite any fixed interest rate payment and would be available for a long period of time. However, the investor may require seat on the board and participation in day to day management of the organization. Further, the investor would like to exit the firm with a good profit. Hence, the firm would need to evaluate the pros and cons of this type of funding.

Similarly, the firm can raise equity capital from institutional ...

Solution provided by:
Sheetal Jain, PGDM
Education
  • BComm, University of Delhi
  • Post Graduate Diploma in Management (Equivalent to MBA), All India Management Association
Recent Feedback
  • "Thanks"
  • "Thanks"
  • "Very good! "
  • "thanks"
  • "Thank you!"
Purchase this Solution
Free BrainMass Quizzes
Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking

IPOs

This Quiz is compiled of questions that pertain to IPOs (Initial Public Offerings)

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

Introduction to Finance

This quiz test introductory finance topics.

View More Free Quizzes
Related BrainMass Solutions

  • venture capital financing

    If at this stage, the VC-firm is not satisfied about the progress or result from market research, the VC-firm may stop their funding and the venture will have to search for another investor.

  • Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

    Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing. A.

  • Internal versus external equity financing

    The major sources of financing capital expenditure are: 1) Debt 2) Equity 3) Preference shares A firm's long-term success depends upon the firm's investments earning a sufficient rate of return.

  • Initial Public Offering Overview

    The Five Financing Stages Normally, when a company's management team reaches the decision to "go public", the company has passed through the final, fifth stage of what is known as the Five Financing Stages in the lifecycle of a start-up of young business

  • IPO Process - The Infernia Corporation

    I have also attached a copy of The Infinera Corporations actual IPO filing to the SEC, as well as other reference sources for your review.

  • Small Business: Raising capital

    The availability of sources and amounts of external capital to the small firms are affected by many factors like stage of product development, availability of capital, risk, ownership structure, firm type, and sales history ( Use of Bootstrap Financing

  • Product Life Cycle: Prius Hybrid

    Growth stage - Introduction stage is followed by the growth stage for the product. In this stage, sales of the product increase so the profits for the firm also increase. After Japan Prius was introduced in the U.S.

  • Venture Capital: New Businesses

    Essentially early stage capital is provided to help the business make expansion and create a mark in the marketplace. Some venture capitalists call the early stage financing first stage financing.

  • Some Business Questions

    On the other hand, the aggressive financing strategy is one under which the firm uses short-term sources of funds for financing its current assets (seasonal needs) of a firm and a part of its permanent needs.

View More Related Solutions