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Financing and entrepreneurship

Utilizing references, please help me explain the following

1. The steps taken to determine which financing alternatives to pursue.

2. The advantages and disadvantages of:
a. Corporate venture capital
b. Private venture capital
c. Angel financing
d. Debt financing

3. Explain which stage in the entrepreneurial process where equity financing and debt financing are most appropriate.

Solution Preview

Utilizing references, please help me explain the following

1. The steps taken to determine which financing alternatives to pursue.

Capital structure determines the cost of the capital. Debt is less costly as compared to equity hence by adding debt one can reduce the equity. But excess of debt can lead to very high financial risk and thereby increase the cost of capital. Thus the company has to maintain the right balance between the debt and equity. Hence One should see the cost of capital, ease of access to funds, owner's attitude to determine the financing ...

Solution Summary

Solution helps in discussing stage in the entrepreneurial process where equity financing and debt financing are most appropriate.

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