SOLUTION MANUAL FOR hj hj
Entrepreneurial Finance, 7th Edition J. Chris Leach (Author),
hj hj hj hj hj hj hj
Ronald W. Melicher (Author)
hj hj hj hj
Chapter 1-16 With Cases Products &Spatial Tech
hj hj hj hj hj hj
Chapter 1
hj hj
INTRODUCTION hjTO hjFINANCE hjFOR hjENTREPRENEURS
hj FOCUS
The hjpurpose hjof hjthis hjfirst hjchapter hjis hjto hjpresent hjan hjoverview hjof hjwhat hjentrepreneurial hjfinance
hjis hjabout. h j In hjdoing hjso hjwe hjhope hjto hjconvey hjto hjyou hjthe hjimportance hjof hjunderstanding hjand
hjapplying hjentrepreneurial hjfinance hjmethods hjand hjtools hjto hjhelp hjensure hjan hjentrepreneurial
hjventure hjis hjsuccessful. hjWe hjpresent hja hjlife hjcycle hjapproach hjto hjthe hjteaching hjof hjentrepreneurial
hjfinance hjwhere hjwe hjcover hjventure hjoperating hjand hjfinancial hjdecisions hjfaced hjby hjthe
hjentrepreneur hjas hja hjventure hjprogresses hjfrom hjan hjidea hjthrough hjto hjharvesting hjthe hjventure.
LEARNING hjOBJECTIVES
LO hj1.1: hjCharacterize hjthe hjentrepreneurial hjprocess.
LO hj1.2: hjDescribe hjentrepreneurship hjand hjsome hjcharacteristics hjof hjentrepreneurs.
LO hj1.3: hjIndicate hjseveral hjmegatrends hjproviding hjwaves hjof hjentrepreneurial
hjopportunities. hjLO hj1.4: hjList hjand hjdescribe hjthe hjseven hjprinciples hjof hjentrepreneurial
hjfinance.
LO hj1.5: hjDiscuss hjentrepreneurial hjfinance hjand hjthe hjrole hjof hjthe hjfinancial
hjmanager. hjLO hj1.6: hjDescribe hjthe hjvarious hjstages hjof hja hjsuccessful hjventure‘s
hjlife hjcycle.
LO hj1.7: hjIdentify, hjby hjlife hjcycle hjstage, hjthe hjrelevant hjtypes hjof hjfinancing hjand
hjinvestors. hjLO hj1.8: hjUnderstand hjthe hjlife hjcycle hjapproach hjused hjin hjthis hjbook.
CHAPTER hjOUTLINE
1.1 THE hjENTREPRENEURIAL hjPROCESS
1.2 ENTREPRENEURSHIP hjFUNDAMENTALS
A. Who hjis hjan hjEntrepreneur?
B. Basic hjDefinitions
C. Entrepreneurial hjTraits hjor hjCharacteristics
D. Opportunities hjExist hjBut hjNot hjWithout hjRisks
1.3 SOURCES hjOF hjENTREPRENEURIAL hjOPPORTUNITIES
A. Societal hjChanges
B. Demographic hjChanges
C. Technological hjChanges
D. Emerging hjEconomies hjand hjGlobal hjChanges
E. Crises hjand hj―Bubbles‖
F. Disruptive hjInnovation
,1
,
, 2 Chapter hj6: hjManaging hjCash
Flow
1.4 PRINCIPLES hjOF hjENTREPRENEURIAL hjFINANCE
A. Real, hjHuman, hjand hjFinancial hjCapital hjmust hjbe hjRented hjfrom hjOwners hj(Principle hj#1)
B. Risk hjand hjExpected hjReward hjgo hjHand hjin hjHand hj(Principle hj#2)
C. While hjAccounting hjis hjthe hjLanguage hjof hjBusiness, hjCash hjis hjthe hjCurrency hj(Principle hj#3)
D. New hjVenture hjFinancing hjInvolves hjSearch, hjNegotiation, hjand hjPrivacy hj(Principle hj#4)
E. A hjVenture‘s hjFinancial hjObjective hjis hjto hjIncrease hjValue hj(Principle hj#5)
F. It hjis hjDangerous hjto hjAssume hjthat hjPeople hjAct hjAgainst hjTheir hjOwn hjSelf-
Interests hj(Principle hj#6)
G. Venture hjCharacter hjand hjReputation hjcan hjbe hjAssets hjor hjLiabilities hj(Principle hj#7)
1.5 ROLE hjOF hjENTREPRENEURIAL hjFINANCE
1.6 THE hjSUCCESSFUL hjVENTURE hjLIFE hjCYCLE
A. Development hjStage
B. Startup hjStage
C. Survival hjStage
D. Rapid-Growth hjStage
E. Early-Maturity hjStage
F. Life hjCycle hjStages hjand hjthe hjEntrepreneurial hjProcess
1.7 FINANCING hjTHROUGH hjTHE hjVENTURE hjLIFE hjCYCLE
A. Seed hjFinancing
B. Startup hjFinancing
C. First-Round hjFinancing
D. Second-Round hjFinancing
E. Mezzanine hjFinancing
F. Liquidity-Stage hjFinancing
G. Seasoned hjFinancing
1.8 LIFE hjCYCLE hjAPPROACH hjFOR hjTEACHING hjENTREPRENEURIAL
hjFINANCE hjSUMMARY
DISCUSSION hjQUESTIONS hjAND hjANSWERS
1. What hjis hjthe hjentrepreneurial hjprocess?
The hjentrepreneurial hjprocess hjcomprises: hjdeveloping hjopportunities, hjgathering hjresources, hjand
hjmanaging hjand hjbuilding hjoperations hjwith hjthe hjgoal hjof hjcreating hjvalue.
2. What hjis hjentrepreneurship? h j What hjare hjsome hjbasic hjcharacteristics hjof hjentrepreneurs?
Entrepreneurship hjis hjthe hjprocess hjof hjchanging hjideas hjinto hjcommercial hjopportunities hjand
hjcreating hjvalue. h j While hjthere hjis hjno hjprototypical hjentrepreneur, hjmany hjare hjgood hjat
hjrecognizing hjcommercial hjopportunities, hjtend hjto hjbe hjoptimistic, hjand hjenvision hja hjplan hjfor
hjthe hjfuture.
3. Why hjdo hjbusinesses hjclose hjor hjcease hjoperating? h j What hjare hjthe hjprimary hjreasons hjwhy
hjbusinesses hjfail?
Entrepreneurial Finance, 7th Edition J. Chris Leach (Author),
hj hj hj hj hj hj hj
Ronald W. Melicher (Author)
hj hj hj hj
Chapter 1-16 With Cases Products &Spatial Tech
hj hj hj hj hj hj
Chapter 1
hj hj
INTRODUCTION hjTO hjFINANCE hjFOR hjENTREPRENEURS
hj FOCUS
The hjpurpose hjof hjthis hjfirst hjchapter hjis hjto hjpresent hjan hjoverview hjof hjwhat hjentrepreneurial hjfinance
hjis hjabout. h j In hjdoing hjso hjwe hjhope hjto hjconvey hjto hjyou hjthe hjimportance hjof hjunderstanding hjand
hjapplying hjentrepreneurial hjfinance hjmethods hjand hjtools hjto hjhelp hjensure hjan hjentrepreneurial
hjventure hjis hjsuccessful. hjWe hjpresent hja hjlife hjcycle hjapproach hjto hjthe hjteaching hjof hjentrepreneurial
hjfinance hjwhere hjwe hjcover hjventure hjoperating hjand hjfinancial hjdecisions hjfaced hjby hjthe
hjentrepreneur hjas hja hjventure hjprogresses hjfrom hjan hjidea hjthrough hjto hjharvesting hjthe hjventure.
LEARNING hjOBJECTIVES
LO hj1.1: hjCharacterize hjthe hjentrepreneurial hjprocess.
LO hj1.2: hjDescribe hjentrepreneurship hjand hjsome hjcharacteristics hjof hjentrepreneurs.
LO hj1.3: hjIndicate hjseveral hjmegatrends hjproviding hjwaves hjof hjentrepreneurial
hjopportunities. hjLO hj1.4: hjList hjand hjdescribe hjthe hjseven hjprinciples hjof hjentrepreneurial
hjfinance.
LO hj1.5: hjDiscuss hjentrepreneurial hjfinance hjand hjthe hjrole hjof hjthe hjfinancial
hjmanager. hjLO hj1.6: hjDescribe hjthe hjvarious hjstages hjof hja hjsuccessful hjventure‘s
hjlife hjcycle.
LO hj1.7: hjIdentify, hjby hjlife hjcycle hjstage, hjthe hjrelevant hjtypes hjof hjfinancing hjand
hjinvestors. hjLO hj1.8: hjUnderstand hjthe hjlife hjcycle hjapproach hjused hjin hjthis hjbook.
CHAPTER hjOUTLINE
1.1 THE hjENTREPRENEURIAL hjPROCESS
1.2 ENTREPRENEURSHIP hjFUNDAMENTALS
A. Who hjis hjan hjEntrepreneur?
B. Basic hjDefinitions
C. Entrepreneurial hjTraits hjor hjCharacteristics
D. Opportunities hjExist hjBut hjNot hjWithout hjRisks
1.3 SOURCES hjOF hjENTREPRENEURIAL hjOPPORTUNITIES
A. Societal hjChanges
B. Demographic hjChanges
C. Technological hjChanges
D. Emerging hjEconomies hjand hjGlobal hjChanges
E. Crises hjand hj―Bubbles‖
F. Disruptive hjInnovation
,1
,
, 2 Chapter hj6: hjManaging hjCash
Flow
1.4 PRINCIPLES hjOF hjENTREPRENEURIAL hjFINANCE
A. Real, hjHuman, hjand hjFinancial hjCapital hjmust hjbe hjRented hjfrom hjOwners hj(Principle hj#1)
B. Risk hjand hjExpected hjReward hjgo hjHand hjin hjHand hj(Principle hj#2)
C. While hjAccounting hjis hjthe hjLanguage hjof hjBusiness, hjCash hjis hjthe hjCurrency hj(Principle hj#3)
D. New hjVenture hjFinancing hjInvolves hjSearch, hjNegotiation, hjand hjPrivacy hj(Principle hj#4)
E. A hjVenture‘s hjFinancial hjObjective hjis hjto hjIncrease hjValue hj(Principle hj#5)
F. It hjis hjDangerous hjto hjAssume hjthat hjPeople hjAct hjAgainst hjTheir hjOwn hjSelf-
Interests hj(Principle hj#6)
G. Venture hjCharacter hjand hjReputation hjcan hjbe hjAssets hjor hjLiabilities hj(Principle hj#7)
1.5 ROLE hjOF hjENTREPRENEURIAL hjFINANCE
1.6 THE hjSUCCESSFUL hjVENTURE hjLIFE hjCYCLE
A. Development hjStage
B. Startup hjStage
C. Survival hjStage
D. Rapid-Growth hjStage
E. Early-Maturity hjStage
F. Life hjCycle hjStages hjand hjthe hjEntrepreneurial hjProcess
1.7 FINANCING hjTHROUGH hjTHE hjVENTURE hjLIFE hjCYCLE
A. Seed hjFinancing
B. Startup hjFinancing
C. First-Round hjFinancing
D. Second-Round hjFinancing
E. Mezzanine hjFinancing
F. Liquidity-Stage hjFinancing
G. Seasoned hjFinancing
1.8 LIFE hjCYCLE hjAPPROACH hjFOR hjTEACHING hjENTREPRENEURIAL
hjFINANCE hjSUMMARY
DISCUSSION hjQUESTIONS hjAND hjANSWERS
1. What hjis hjthe hjentrepreneurial hjprocess?
The hjentrepreneurial hjprocess hjcomprises: hjdeveloping hjopportunities, hjgathering hjresources, hjand
hjmanaging hjand hjbuilding hjoperations hjwith hjthe hjgoal hjof hjcreating hjvalue.
2. What hjis hjentrepreneurship? h j What hjare hjsome hjbasic hjcharacteristics hjof hjentrepreneurs?
Entrepreneurship hjis hjthe hjprocess hjof hjchanging hjideas hjinto hjcommercial hjopportunities hjand
hjcreating hjvalue. h j While hjthere hjis hjno hjprototypical hjentrepreneur, hjmany hjare hjgood hjat
hjrecognizing hjcommercial hjopportunities, hjtend hjto hjbe hjoptimistic, hjand hjenvision hja hjplan hjfor
hjthe hjfuture.
3. Why hjdo hjbusinesses hjclose hjor hjcease hjoperating? h j What hjare hjthe hjprimary hjreasons hjwhy
hjbusinesses hjfail?
