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Exam 4: Getting Your E-Business Off the Ground

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Question 31

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A pitch document:

A) specifies the terms of an investment agreement
B) discloses the benefits and risks of an investment to potential investors
C) highlights a market need and briefly explains how a new business can profitability exploit that need
D) provides evidence that an individual is qualified to be an accredited investor

E) None of the above
F) B) and C)

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Question 32

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An investor who wishes to join an angel investment club must meet the stringent financial qualifications needed to become a(n)_______________investor.

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Question 33

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When presenting an e-business idea to a(n)_______________, an entrepreneur should remember that the investor's primary interest is how well the new e-business idea fits a market need.

One of the best ways for an entrepreneur to approach a(n)_______________is to arrange to have his or her business plan submitted through a mutual trusted source.

Which of the following investor groups often provides not only the first significant startup funds for a new business but also useful business experience and advice.

Business incubators are sometimes called business_______________.

In general, a(n)_______________invests from $250,000 to $1,500,000 in the early stages of a new business, and may invest several million dollars over the course the business's life.

The typical equity percentage required by a(n)_______________is in the 30-40 percent range.

Venture capitalist firms rarely focus their investment activities in a specific industry, funding round, or geographic location.

An entrepreneur should be prepared, be on time, and bring everything he or she needs when meeting with potential investors.

_______________is an example of a successful and well-known e-business that received early VC funding.

Before accepting startup funds from friends and family members, an entrepreneur should make certain they understand that a startup venture is a(n)_______________proposition.

The first meeting with a potential investor of any type is a sales meeting.

An entrepreneur will likely review all the details of his or her business plan during the first meeting with potential investors.

More than half of all informal investing in U.S. startups and growing companies is by:

To avoid misunderstandings, an entrepreneur soliciting startup money from his or her network of family members and friends should:

Angel investors typically base an investment decision on a new business idea rather than on the strengths of the entrepreneur who has the idea.

During a(n)_______________to potential investors, an entrepreneur should be prepared to answer questions about any risks or problems associated with his or her business idea and how these risks or problems will be handled.

Discuss how an entrepreneur should prepare for his or her first meeting with potential investors.

The average startup business remains in a business incubator's portfolio for approximately: