MNE3701
Assignment 3
Semester 2
DUE 27 September 2024
, QUESTION 1: Financing Your Business
As a budding entrepreneur planning to start an artisanal bakery, I have several
financing options available to fund my business operations. Below are specific
financing methods and the rationale behind my choices.
Personal Savings:
Example: Prior to launching my bakery, I would save a portion of my income and set
aside funds specifically for the business venture.
Motivation: Using personal savings provides full ownership of the business without
incurring debt or giving up equity. This method fosters a strong sense of commitment
towards the success of the business, as the investments come from my own
resources.
Family and Friends Loans:
Example: I could approach family and close friends to invest in my bakery. This
could involve informal loans or small investments in exchange for a share of profits.
Motivation: This type of financing often comes with lower or no interest compared to
institutional loans, creating a supportive environment. Moreover, these investors are
often more forgiving regarding repayment terms.
Crowdfunding:
Example: I would launch a campaign on platforms like Kickstarter or Indiegogo to
raise funds. I would offer incentives such as personalized baked goods or discounts
for early backers.
Motivation: Crowdfunding is effective in gauging market interest while simultaneously
securing funds. This approach also serves as a marketing tool, generating buzz
around the business before it officially launches.
Bank Loans:
Example: I might apply for a small business loan from a bank to cover substantial
initial costs, such as renting a storefront and purchasing equipment.
Assignment 3
Semester 2
DUE 27 September 2024
, QUESTION 1: Financing Your Business
As a budding entrepreneur planning to start an artisanal bakery, I have several
financing options available to fund my business operations. Below are specific
financing methods and the rationale behind my choices.
Personal Savings:
Example: Prior to launching my bakery, I would save a portion of my income and set
aside funds specifically for the business venture.
Motivation: Using personal savings provides full ownership of the business without
incurring debt or giving up equity. This method fosters a strong sense of commitment
towards the success of the business, as the investments come from my own
resources.
Family and Friends Loans:
Example: I could approach family and close friends to invest in my bakery. This
could involve informal loans or small investments in exchange for a share of profits.
Motivation: This type of financing often comes with lower or no interest compared to
institutional loans, creating a supportive environment. Moreover, these investors are
often more forgiving regarding repayment terms.
Crowdfunding:
Example: I would launch a campaign on platforms like Kickstarter or Indiegogo to
raise funds. I would offer incentives such as personalized baked goods or discounts
for early backers.
Motivation: Crowdfunding is effective in gauging market interest while simultaneously
securing funds. This approach also serves as a marketing tool, generating buzz
around the business before it officially launches.
Bank Loans:
Example: I might apply for a small business loan from a bank to cover substantial
initial costs, such as renting a storefront and purchasing equipment.
