Essay About Small Start Money And Different Periods

Entrepreneurial Finance Course Note
TitleSubjectTech: small start money (fb: 100 thou-250mi)real estate: huge start moneyhundreds of millions—>who fund? (require return)fall in which category?page 4how much/long? constrained or not?when? in 2 months (should have raised for 6 months)suit your term? allow the company grow? (more than cash) eg. Angel; VC – supervisor;secure? partner (boutique VC)page 7[Debt]: principle+interestminimize the riskpage 8cash: COVNANTSnon-cash: trademark/IPventure: highly-reputed even if cash negative(a)cheaper (b)faster; problem? repay the debt requires more expensive…page 10[Equity]why bear more risk? new equity come-in5X? 2m—>succeed min:10meg. baseline ‘decylination for Disney? could be successful-potential; then the return should be….Professional managed firm (VC, PE, HF, )recourse?; control the capital, distribute into different periods – revaluateboard seats: shareholder: dilute; supplier; if big VC back up, then easier to employ and monitor performance (Risk: don’t devote 100%)The vast majority failspage 12hybrid [Convertible Debt] DEBENTURE; note-start as debt, end as equity-cheap, no disclosurenon-priced financingeg. 1m (implicitly: 20% discount, explicitly: no price) valuation; 10m-at cap 5mUPSIDEpage 13Joke: It depends. on one hand,… on the other hand,… (Can I have only one arm? 0.0)strategy~ (syndicator?align…) conflicting interest-suggest an appropriate partnership-close relationship;alumni-Harvard…(Non-traditional financing…) guanxi..first dimension: second dimension:novelty X capital intensity: PC; low initial capital: google, uber…Power; Valley of death (R&D)-where? State funding; This is why university exists! (eg. AIDS)-time and moneypage 15Is more money better?give up too muchTradeoffNew Yorker article: ? be constrained by Human Being*When answering a question. Ask Whom the argument coming from? (lean start-up)block investorsraise only enough for 12-18 monthsphilosophy questionGroup workingDec 1st; 11,10,9investor: Dec 7th 7,8,9early-stage valuation;Industry: Food…Electrical; Sports…survey of mkt; back-up research