StudentShare solutions
Triangle menu

New Business Venture - Essay Example

Not dowloaded yet

Extract of sample
New Business Venture

In this case, it is advised to look in for a more structured form of finance rather than unstructured financing option like funds from relatives and friends. This is because structured finance has several advantages which funds from relatives may not have.
2. Decision Making: Moreover, just as in the case of "Gift Baskets", the fund giver has to be given a say in the decision making and strategic moves of the business. This may also result in delay in decision making.
3. Partnership: When one approaches a relative or friend for investment in the business, it is generally done by an offer of partnership. This means an additional person would be there to share the profits of the business. However, the other funding options do not require this.
4. No Expertise: The promoters of the business may be well aware of the industry and the market scenario. However, the relative who contributes to the business capital as an investment may not have similar expertise. This will result in hassles, when some necessary move is to be taken in the business and the relative does not agree with it.
5. Revelation of Secrets: The business happens to be the brain child of the promoters. A partner who can fund your business can as well take up your business idea and start his own business, if the matter is money.
Banks are one of the known forms of funding the business financ...
Let us now view a couple of structured funding options with their working and risks.

Banks are one of the known forms of funding the business finance gap. However, banks are normally considered conservative lenders. One can avail long term loans for premises, machinery, furniture etc. with his choice of payment horizon or short term loans renewed per year for working capital with collateral of stock and book debts. Generally, banks prefer to fund the business on the creditworthiness of the promoter's future scope of the business and the value of the collateral. They also expect secondary collateral in the form of some asset like insurance policies, fixed deposits, land, building etc.
Positives
Funds happen to be less expensive
Bank credit happens to build up reputation of the business
A choice of variety of loans suiting business requirements.
Integration is possible with other financial services
No infringement in business decisions
Risks
Conservative covenants and condition
Delay in sanction of loans
Paper work and requirement of business paper fulfilling all laws
High collateral or mortgage

Venture Capital
Venture capitalists look for funding businesses with good future prospects and have an aim of having good returns through capital appreciation. This requires a solid and clear business plan with a long term view. However, they would also intend to have certain rights of control over the business. But, it would be right to note that, it would be in the best interest of the business as they are typically intending to make good out of their investment so as to make the business flourish to give them returns on their investment. The positive side of this source of finance is the good amount of availability and the risk involved is that of ...Show more

Summary

Various business ventures are happening day to day and each business requires not just initial capital to start off, but there is also a need for working capital for day to day stock needs, salaries and administrative cost. Moreover, for a start up business, the funds requirement is higher due to promotional expenditure and advertisement too.
Author : barrowsstephani
New Business Venture essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"New Business Venture"
with a personal 20% discount.
Grab the best paper

Related Essays

Researching and Developing a New Business Venture
The paper focuses on the customer feasibility assessment for setting up an Afro-Caribbean restaurant in Allerton, a suburb in Liverpool, United Kingdom. The paper discusses the micro-level as well as the macro-level assessment of the market for the restaurant.
15 pages (3750 words) Essay
Creating a new business venture
As such, this paper has been designed to evaluate the measures that can be taken in order to create a sound business venture for Accarpio Transport. Organizational Review and Executive Summary Mission The company’s mission is to provide the best quality experience possible in the transport sector.
10 pages (2500 words) Essay
New Business Venture
In order to effectively take advantage of the new business opportunities as well as to better understand the dynamics of the business, it is really critical that the entrepreneurs must develop certain set of skills. Apart from this, it is also important to understand that in order to become successful it is important that the entrepreneur must develop a certain mindset.
24 pages (6000 words) Essay
New Business Venture
This paper therefore highlighted some of the important requirements which new entrepreneurs must have in order to successfully present the new opportunity. A complete scanning of the external environment and how it can actually help generate the new opportunities is also presented.
19 pages (4750 words) Essay
New Business Venture
Rational decisions therefore directly and indirectly allow the organizations to utilize their resources in most optimal manner and hence achieve the better efficiency and long term competitiveness in order to survive in the market.
17 pages (4250 words) Essay
How to start a new business venture
4bn with a growth of around 1% during the recession with customer base of around seven million users which has grown 12% over the last 20 years. With this growing industry, London is one of the major contributors for the growth in UK and the potential customer base in that region can act as a great catalyst to increase the business in future.
9 pages (2250 words) Essay
How to start a new business venture
.5.People 15 6.1.6.Process 15 6.1.7.Physical Evidence 16 7.Conclusion and Recommendations 16 Reference 18 1. Introduction Starting a venture is much challenging task than the managing the established business. The success rate of new business is very low in the prevailing competitive age.
9 pages (2250 words) Essay
CREATING AND STARTING A NEW BUSINESS VENTURE
My father also readily agreed to my idea and offered to help me with the investment as he knows a retail business in wine offered a good prospect in London where we live. I
17 pages (4250 words) Essay
Opportunity Analysis of New Business Venture 03067
Technological progression of the digital and DSLR (digital single lens reflex) cameras have provided newer avenues for developing business in this arena. Moreover, the photography industry in Canada has been witnessing growth in the
8 pages (2000 words) Essay
Opportunity Analysis of New Business Venture 03068
The market is considered saturated as there are mostly a lot of competitors doing the same thing in the same way (Rowen, 2008). An innovative
8 pages (2000 words) Essay
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT
Comments (0)
Rate this paper:
Thank you! Your comment has been sent and will be posted after moderation