Ent. & Small Biz Notecards
What is Break Even Analysis and what is the formula to calculate? Elements of a Financial Plan (Small Business Chap 4 Biz Plan Dev)
Break Even analysis - exact sales needed to cover cost, help ensure variable costs remain at acceptable levels. Exact point where venture will neither lose money nor make money Fixed Cost/ Gross Margin X Variable Cost = Break Even Analysis
Income Statement Compliments the Balance Sheet, What does the Income Statement include, List line items of each? Elements of Financial Plan (Small Business Chap 4 Biz Plan Dev)
Net sales - revenues and sales (minus any minor deductions such as returns) Revenues - accrued total earnings by sale of goods and services Costs of Goods Sold - direct cost associated with generating revenues (raw material, labor, shipping) Gross Profit - Net Sales minus COGS Other Income (Interest Revenue) Sales and General Administrative Expenses (operating expenses accrued during income statement period. Advertising, salaries, rent, utilities, fringe benefits) Net Income - (total excess revenue over related expenses for the period of the statement)
What is identified in a balance sheet? List line items of each (static picture / snapshot) Elements of Financial Plan (Small Business Chap 4 Biz Plan Dev)
(Static picture / snapshot) Assets (What business owns / profits) - Cash, Accounts Receivable, Costs of Goods Sold, Inventory, FFE, land, prepaid expenses (Decreasing liquidity listed first (cash>non liquidity)) Liabilities (What business owns / owes) - accounts payable (owed to suppliers), notes payable (promissory notes due within one year), accrued expenses (wages, salaries, employee incomes, FICA), taxes payable, current portion of long-term debt (due within 1 year) (Decreasing Immediacy listed first (items that are due first?) Equity - Assets - Liabilities = Owner's equity/ net worth
Name four elements a business plan development pulls together for a new business to prosper (Small Business Chap 4 Biz Plan Dev)
1. Guide for future business growth and development 2. Identifies Customers and Target markets 3. Analyzes the competitive environment 4. Opens the doors to the investment process
Metrics for evaluating incubators (10)? (Small Business Chap 5 Incubators)
1. Number of current clients 2. Total number of graduates since inception 3. Number of graduate firms still in business 4. Number of people currently employed full-time by client and graduate firms 5. Number of people currently employed part-time by client and graduate firms. 6. Current monthly salaries and wages paid by client and graduate firms 7. Gross revenues 8. Dollar amount of debt capital raised 9. Dollar amount of equity capital raised 10. Dollar amount of grant funds raised
Any successful venture or entrepreneur needs to be surrounded by a supportive network, name 5 ways a network can be helpful? (Small Business Chap 2 Tech Assistance)
1. Offer information 2. Counsel 3. Encouragement 4. Leads 5. And access to resources of all kinds
Name two forms of Networks (Small Business Chap 2 Tech Assistance)
1. Peer Network 2. Mentor Network
When considering debt financing, what do commercial bankers look for? (Small Business Chap 6 Financing)
5 C's • Character: record of repaying • Capacity: ability to repay • Conditions: environmental impacts • Capital: net worth/equity in the business • Collateral: assets to secure the loan
Who created the Economic Gardening concept and when? What is Business Dynamic statistics (BID) (Small Business, Chapter 3 - Economic Gardening)
Christian Gibbons in 1980's from Littleton, Colorado
What are the 3 stages of growth for entrepreneur's and small businesses? Describe each What is Business Dynamic statistics (BID) (Small Business, Chapter 3 - Economic Gardening)
Start-up companies - new business venture where innovation drives startup Second-stage companies - enough employees to exceed comfortable control span of one owner, do not have a full-scale professional management team Gazelles or High Impact companies - generally emerge from business to business markets with rapid expansion of at least 20% per year over the previous year.
Funding sources for Incubators? (Small Business Chap 5 Incubators)
• EDA Public Works and Development • Community Development Block Grants (CDBG) • Industrial Development Bonds • Donations • Foundations • Real Estate Syndication
What is the Angel Capital Education Foundation? (Small Business Chap 6 Financing)
• Founded by the Kauffman Foundation • A charitable organization that seeks to promote angel investment through o education, o information dissemination, o and research to support investors, entrepreneurial support organizations, university faculty and students and policy makers.
Describe the Edward Lowe Foundation (Small Business, Chapter 3 - Economic Gardening)
• Founded in 1985 provide info and education support 2nd stage businesses, build peer support system and database to track Economic Support Orgs' best practices and common problems • Developed Companies to Watch which designates awards to successful second state entrepreneurs • Manages Youreconomy.org which stemmed from Lowe Foundation, updated pool of performance data on businesses and the local economy.
What are Co-Working Collaborative Spaces? (Small Business Chap 5 Incubators)
• Gained attention in urban and rural communities around the US • Small office facilities and conference rooms • Is just designated space for aspiring entrepreneurs • Networking opportunities abound
What do lenders and investors want to see when assessing an applicant? Ch 7
• Preliminary company info • Marketing info • Management • Financial statements
3 important elements to choosing your incubator space? (Small Business Chap 5 Incubators)
• Size: enough cash flow to ensure financial operation. • Physical requirements: expansion potential, space flexibility due to high turnover rate, floor plan • Synergy: promote tenant interaction, shared areas
What is the SBA and what is its mission? Ch 7
• Small biz administration, mission to aid, counsel, assist and protect the interests of small biz. Can serve as a lender for small biz. Some SBA mechanisms are: o Guaranteed loans through participating SBA lenders - loan is federally guaranteed o Small biz investment companies (SBIC's) - private venture capital firms that make equity investments and long term loans to small biz, funding is supplemented by us gov guaranteed debt from SBA o Federal contracts - tries to ensure small biz receive a fair portion of govt. purchases, contracts and subcontracts
What are Retail Incubators? (Small Business Chap 5 Incubators)
• Smaller than regular incubators • Market-driven, dependent on shoppers with specific preferences and buying habits • Location is very important - need foot traffic
What is the best way to determine what the future needs of businesses will be in a given area? (Small Business Chap 2 Tech Assistance)
• Survey existing local businesses
Incubators are used to meet what three objectives? (Small Business Chap 5 Incubators)
• Technology Based Development • Economic Diversification • Community Revitalization
Why are youth entrepreneurship programs important to ED? (Small Business Chap 2 Tech Assistance)
• The thirst for entrepreneurship cannot start too young, youth entrepreneurship programs tap this sector of the entrepreneurial market for future growth • Youth programs are more multi-faceted and "hands-on in their training approach
Why do institutions and higher education support entrepreneurs? (Small Business Chap 2 Tech Assistance)
• They recognize that the success of business efforts can increase the vibrancy and appeal of the area and thus the school • Students in business, planning or law programs get real world experience when helping entrepreneurs.
What's the primary goal of an incubator? (Small Business Chap 5 Incubators)
• To help new businesses establish self-sufficiency with enough capital to afford rental space in non-incubator facilities
What is Debt Capital? (Small Business Chap 6 Financing)
• Typically delivered the form of loans that are based on the entrepreneur's ability to repay. • A non-dilutive investment
What are Angel Investors? (Small Business Chap 6 Financing)
• Typically independent high net worth individuals or a group of high net worth individuals who invest in start-ups. • Typically invest locally and in industries with which they are familiar • Typically serve as mentors in some capacity • Invest less than venture capital firms but more than commercial banks • EMKF estimates angel investors are responsible for 90% of outside equity raised by start-ups. • The source of $20 million in capital for estimated 50,000 businesses every year.
What are some Special Incubator Programs? (Small Business Chap 5 Incubators)
• Virtual Incubators • Retail Incubators • Co-working collaborative spaces
What 2 questions must the Description of Product or Service answer? (Elements of a business Plan) Elements of a Business Description (Small Business Chap 4 Biz Plan Dev)
• What benefits does the consumer gain from the product or service • How does the product or service differ from the competitors' products and services
What 6 questions does the Executive Summary answer? (should be no more than one page, 1 -2 sentence answers for each) (Small Business Chap 4 Biz Plan Dev)
• What is the business • What product or service do you offer • What is the target market, (how will the business differentiate from competitors, and how will business gain a competitive advantage?) • How much money is needed, what will money be used for, how will money benefit the business • How will loan be repaid • What unique management team strengths will enable them to achieve objectives
Market Segmentation / Identification should consider what 3 concepts? Elements of a Business Description (Small Business Chap 4 Biz Plan Dev)
• Where the Market is not being served • Where Consumer needs are currently not being adequately satisfied • Where Growth potential for a new provider remains
What is the Angel Capital Association? (Small Business Chap 6 Financing)
• the trade association of leading angel investment groups in North America. • Mission is to support the growth, financial stability and investment success of member angel groups by providing o Professional development o Best practices o Networking and collaboration opportunities • Public policy voice of the angel community
What is identified in a Statement of Cash flow? List line items of each Elements of Financial Plan (Small Business Chap 4 Biz Plan Dev)
Estimated Sales - based on 1st year of estimated sales level Cost and Expenses Forecast - err on side of caution (pessimistic),include monthly & 1time opening cost Cost of Sales / Manufacturing (to project, contact suppliers for product cost) Selling General and Administrative Expenses (rent, phone, insurance, wages, gas, sewage, marketing) o Application and expected effect of Loan / Investment o Capital Equipment List o Balance Sheet o Ratio Analysis o Income Projections / Profit Loss Statements o Cash flow projections
Outline of a Business Plan (6 main elements) (Small Business Chap 4 Biz Plan Dev)
1. Cover Sheet 2. Executive Summary 3. Table of Contents 4. The Business 5. The Financials 6. Supporting Documents
Five points to address before writing a business plan (Small Business Chap 4 Biz Plan Dev)
1. Describe why your customer will purchase or use your product 2. Explain why larger competitors won't recreate you product and push out smaller markets 3. Explore the competition and market analysis 4. Project financial returns and needs on a income statement and balance sheet 5. Define the personal goals, current needs and future interests of entrepreneur and why they are willing to devote the next 10 years to the venture
Name some of the 10 areas small biz and entrepreneurs may need technical assistance in? (Small Business Chap 2 Tech Assistance)
1. Determining what form of enterprise they should start 2. Deciphering specific legal regulations and codes 3. Understanding applicable tax requirements 4. Writing a business plan 5. Access to capital 6. Financial management techniques 7. Market and competition analysis 8. Workforce development 9. Commercialization and technology transfer programs 10. Exit Strategies
Name 16 resources that provide technical resources to stimulate small business and entrepreneurial success (Small Business Chap 2 Tech Assistance)
1. Federal Government 2. State Government 3. SBA and SBDC's 4. U.S. Department of Agriculture 5. US Department of Housing and Urban Dev 6. Internal Revenue Service 7. Service Corps of Retired Executives (SCORE) 8. Minority Business Development Agency (MDBA) 9. Youth entrepreneurship programs 10. Community organizations 11. Chamber of Commerce 12. Business Assistance Centers 13. Incubators / Accelerators 14. Economic Gardeners 15. Commercialization intermediaries / Tech transfer programs 16. Educational Institutions (K-12, community college, universities)
What are some things to look for when evaluating financial condition of a biz? (Ch. 7)
1. Personal and other informal financial resources - using these resources shows owner has made effort to pull in as many personal resources and possible 2. Internal biz resources - cutting back on expenses, good management, scheduling bill payments around cash inflows making more capital available. Obtaining up-front payment for products sold and employing discount techniques Other means of expanding small biz finances: • Reduce overhead • Manage cash flows and assets • Dispose of non-productive inventory • Collecting deposits from clients • Ensuring capital assets are used efficiently • Negotiating low prices from suppliers • Leasing equipment/locations instead of purchasing • Trade credit with suppliers
Name the 7 Legal Structures of a business and describe each? (Small Business Chap 2 Tech Assistance)
1. Sole Proprietorships 2. General Partnerships 3. Limited Partnerships 4. Corporations 5. Limited Liability Companies 6. S-Corp 7. C-Corp
There are 11 areas the State is involved with legally when operating a business, name them: (Small Business Chap 2 Tech Assistance
1. State Occupational License 2. Workmen's Compensation 3. State Unemployment Insurance (SUI) 4. Corporate and Personal Income Tax 5. State Sales and Use Tax 6. Real and Personal Property Tax 7. Business and Occupation Tax 8. Public Utilities Tax 9. Leasehold Excise Tax 10. State Intangible Tax 11. Hazardous Waste Generator Tax (paint waste tax)
What Categories might you find on a Balance Sheet? (Small Business Chap 2 Tech Assistance
Assets Working capital Assets Cash Inventory Fixed Assets Liabilities Rent Accounts Payable Payroll Legal fees Insurance Postage
What is the SBA's Pre-qualification Pilot Loan program? Who is eligible (Small Business Chap 2 Tech Assistance)
Assist underserved small businesses in the lending world with technical assistance for loan application packaging 51% or more owned by veteran, women, and /or minorities, exporters, rural markets, and certain designated geographical areas and industries
What is a CDC? (Small Business Chap 2 Tech Assistance)
Community Development Center Non-profit organization committed to revitalizing their community and developing real estate sites, but they also provide services and resources to entrepreneurs and small business owners through training, business planning assistance. • Contact National Congress for Community Economic Development to find your local CDC
Who or What is the nation leading expert on entrepreneurship? (Small Business Chap 6 Financing)
Ewing Marion Kauffman Foundation
What does Gardening mean? (Small Business, Chapter 3 - Economic Gardening)
Gardening means: growing jobs in the community through the provision of entrepreneurial support services instead of recruiting employers with attraction activities, inside out vs outside in strategy for economic development. It is one of the fastest growing approaches to ED in today's economy
Where does SBDC funding come from, and what 3 major services do they provide? (Small Business Chap 2 Tech Assistance)
Less than 50% of funding comes from SBA and remaining comes from sponsors • Basic Business Consulting • Training Programs • Information Research Services
What is a LLC? (Small Business Chap 2 Tech Assistance
Limited Liability Companies and Partnership • Provide limited liability protection of a corporation with the flexibility of a partnership • Profits are not taxed directly (like a partnership) • Similar to a corporation, claims against the corporation rests with the corporation itself • Similar to a partnership business income and losses are distributed to the owners of the business
What is included in Income Projections / Profit Loss Statement? Elements of a Financial Plan (Small Business Chap 4 Biz Plan Dev)
Profit and Loss or Income Statements (detailed account of the business over a period of time, and reflect business sales and expenses,) it is only a representative summary 3 year summary Detail by month for 1st year Detail by quarterly for 2nd and 3rd years Notes of explanation
Describe pros and cons of a Sole Proprietorship? (Small Business Chap 2 Tech Assistance
Pros • 1 owner with full control and retains all profits, less paperwork than their counterparts • reduces legal restrictions, • quick termination of business Cons • Personal liability • Difficult to raise funds • If owner dies it is difficult to discontinue business
What are the pros and cons of a General Partnership? (Small Business Chap 2 Tech Assistance)
Pros • multiple financial and administrative resources to rely on • Profits are not taxed directly • No formal filings of consummation required Cons • Owners bare unlimited liability • Partnership ends if one of the partners die • Any partner can change orientation of the organization
What is the difference of an S-Corp and a C-Corp? (Small Business Chap 2 Tech Assistance)
S-Corp treated under Subchapter S for federal tax purposes • Individual shareholders pay corporate net income personally • income and expenses are divided among the shareholders in proportion to their holdings • Profits are taxed at the shareholders respective tax rates C-Corp refers to standard state form corporation • assumes separate legal and tax life distinct from its shareholders • Taxes are paid at a corporate income tax rate • may become a public corporation with shares bought and sold through a stock market or over the counter. • no limit to the number of shareholders, they do not have to be citizens nor residents of the U.S.
What is the formula for Owner's Equity / Net worth? Elements of a Financial Plan (Small Business Chap 4 Biz Plan Dev)
Total Assets - Total Liabilities = Net worth
What is a SS-4 Form used for (Small Business Chap 2 Tech Assistance
Used to obtain a Federal Employer Identification Number (FEIN) from the IRS, this will register the business. Most firms are required to apply for this registration regardless if they have employees.
Competitive Analysis Elements of a Business Description (Small Business Chap 4 Biz Plan Dev)
o Identify the strengths and weaknesses of competing firms o How are major competitors and industry leaders doing o Assess what competitor offers in response to customer needs, identify what you will offer in comparison
Describe What is a Ratio Analysis? Elements of a Financial Plan (Small Business Chap 4 Biz Plan Dev)
o Ratio analysis- is a general guideline that indicates business financial health, target ratio levels can vary greatly among industries you can access target ratios for industry from SBDC or National Trade Association Working Capital = Current assets - Current Liabilities Current Ratio = Current Assets divided by Current Liabilities (2.0 preferred by most bank) • Fixed Costs: Include office overhead (rent, salaries, and taxes) interest charges on loans / mortgages and depreciation. Remain constant regardless of Sales Volume • Gross Margin = Sales - Final Cost of Goods Sold • Variable Costs: Include Commission, variable labor, and other industry specific costs that fluctuate with the amount of sales.
Analyzing Industry and Competition: What are 5 questions to ask during Industry analysis (most research intensive) Elements of a Business Description (Small Business Chap 4 Biz Plan Dev)
o What firms entering and exiting industry o How do firms in industry compete and deliver product to consumers / retailers o What impact will political, environmental, social, and technology have on the industry o How do firms in the industry obtain financing o What if any are the emerging trends
How many business incubation programs were there in 2006? (Small Business Chap 5 Incubators)
• 1100
Business Incubators in North America are sponsored by who (percentages)? (Small Business Chap 5 Incubators)
• 31% EDO's • 21% Government • 20% Academic Institution
What industries/sectors/markets are services by incubators (percentages)? (Small Business Chap 5 Incubators)
• 54% Mixed Use • 39% Technology • 3% Manufacturing • 1% Service • 4% Other
Most experts agree it takes "how long" for new enterprises to become solidly established? (Small Business Chap 5 Incubators)
• 6 months
What is Equity Financing? (Small Business Chap 6 Financing)
• A dilutive investment because it requires the entrepreneur to give up a portion of ownership. • Does not require repayment • Capital is infused in the business to leverage debt. • Typically from venture capital firms and angel investors
What are Angel Groups? (Small Business Chap 6 Financing)
• Angel investors join together to invest, share best practices, and bring the power of the group to bear to make the start-ups successful. • Currently more than 300 angel groups in the US • Can be easily located • Offer larger investments than individual angel investors
What are the elements of the Financial Plan? (8)
• Application / Expected Effect of Loan • Capital Equipment List • Balance Sheet • Ratio Analysis • Break-even Analysis • Income Projections (Profit and Loss / Income Statement) o Pro-forma 3 year summary - Projected by month for 1st year, by quarter for 2nd and 3rd year, Notes of explanation • Cash Flow projection o Detailed by month for 1st year, by quarter for 2nd and 3rd year, Notes • Supporting Documents
What financial statements are examined by equity investors and creditors? Elements of Financial Plan (Small Business Chap 4 Biz Plan Dev)
• Balance Sheet • Income Statement / Profit and Loss Statement • Cash Flow Statement
What 4 forms of technical assistance is offered to entrepreneurs and small Business owners? (4 - general) (Small Business Chap 2 Tech Assistance)
• Business counseling • Business plan development • Financial opportunities • Serving as a gateway to other business assistance programs
What are the 5 C's? Ch 7
• Character - borrowers record in repaying past obligations and reputation • Capacity - ability to repay loan from primary and secondary sources • Conditions - external or internal envoironment effecting the borrower or industry • Capital - borrowers net worth/equity in the enterprise • Collateral - assets pledged to secure a loan in event unable to repay.
Where can you get some debt financing products for small businesses? (Small Business Chap 6 Financing)
• Commercial banks • SBA • USDA • CDFI's • CDC's • Microfinance Organizations • Bank CDC's
Before starting an incubator, a feasibility study should be conducted. What should be included in the feasibility study? (Small Business Chap 5 Incubators)
• Community, Economic Base & Market Niche • Potential Sites • Cash Flow Analysis • Management Structure • Legal Issues
What are the critical features to consider during site selection for an incubator location? (Small Business Chap 5 Incubators)
• Condition • Fire Sprinkler System • Environmental Audit • Utilities • Shipping Dock Access • Floor Load Limits & Ceiling Heights • Access for Employees • Parking • Security Advantages & Disadvantages • Restrooms • Elevator • Cranes
When working with start-ups and 2nd stage companies, the main features of a gardening program are: (Small Business, Chapter 3 - Economic Gardening)
• Connectivity - teaching, mentoring and networking • Market research- high power tools for competitive intelligence • Community and Workforce Development and Infrastructure - education, community amenities, meeting places and incubators
What are some ways communities have empowered their entrepreneurial culture? (Small Business, Chapter 3 - Economic Gardening)
• Converting grocery stores into local food production centers • Creating a single, agency driven overlapping network of investors and entrepreneurs • Teaching people how to network, provide network opportunities • Turn public libraries into ED gardening hot spots • Business Plan award programs • Entrepreneurship Day at local High Schools • Entrepreneur Hall of Fame • Recognizing Home-based businesses and helping them grow
What is the Community Adjustment & Investment Program? (Small Business Chap 6 Financing)
• Created in tandem with NAFTA • To provide credit to new or expanding businesses in communities with significant job losses due to changes in trade with Canada and Mexico. • Available for commercial projects that create new private sector jobs. • Administered through SBA or USDA
What is Business Dynamic statistics (BID) (Small business, Chapter 3 - Spotlight)
• Data series created through a partnership between the U.S. Census Bureau's Center for Economic Studies and the Ewing Marion Kauffman Foundation. • BDS follows and reports national changes in employment levels, • provides understanding of growth rates of new companies and maturing second tier companies in their region.
What are the two forms of financial support? (Small Business Chap 6 Financing)
• Debt • Equity
What are the 2 forms of financing capital? Ch 7
• Debt - capital loans repaid with interest on pre established schedule o Relies on biz ability to repay the loan o Relies secondarily on value of assets offered as collateral o Allows the owner to not lose any part of ownership • Equity - do not require a firm to repay its debt, investors assume partial ownership (ie biz partner). Examples: limited partnerships, preferred stock, common stock, warrants. o Does not require repayment of interest and principal o Provides a capital base on which debt can be leveraged o Requires the initial owner to give up partial ownership of biz
Name 5 ways to segment consumer markets Elements of a Business Description (Small Business Chap 4 Biz Plan Dev)
• Demographics (race, age, gender, household income, education, income) • Psychographics (Lifestyle, interests, personality, activities, opinions) • Geography • Behavior (motives, cultural value, social status, attitudes) • Businesses ( Kind of business, NAICS, location, web presence, stage of business, number of employees)
What are the elements in the Business Description of a business plan(10)? (Small Business Chap 4 Biz Plan Dev
• Description of business • Description of product • Location of business • Customer market and why they will buy your product • Market Segmentation / Identification • Industry/Completion analysis • Marketing Strategy • Management experience • Staffing • Overall Schedule (month by month timetable to launch business) Community Benefits (what will business bring to the area)
What are 3 successful exit strategies for incubators? (Small Business Chap 5 Incubators)
• Graduated rent schedules: gradually increases rent payments until rates are comparable to market rents. • Lease terms: exit date set in original lease. • Facility purposes: meet certain criteria to remain in the space - ie: jobs or profits.
Equity Financing is common among what type of business? (Small Business Chap 6 Financing)
• High-technology and innovation-based Start-Ups
What two questions should EDO staff ask of entrepreneur's? (Small Business Chap 2 Tech Assistance
• How much relevant experience do you have in this field? • How much of your own cash will you be willing to put into this business enterprise?
What basic info do lenders want to know? Ch 7
• How much the biz wants to borrow • What the money will be used for • How the loan will be paid back
What are Venture Capital firms? (Small Business Chap 6 Financing)
• Invest other investors' money into a start-up to bring the firm's clients large profits • Disproportionately represented in Silicon Valley and New England • Venture deals are in the seven figure range • Focus on businesses with high growth potential.
Describe Limited Partnerships (Small Business Chap 2 Tech Assistance)
• Involves 3 or more people • 2 general and 1 limited • At least 1 partner has limited liability (less responsibility and involvement) • Limited partners not involved in the regular management, have less responsibility and liability • Partners have the same responsibilities as general partnerships
Local Communities enact zoning laws to control privately owned land. What areas do they mandate? (Small Business Chap 2 Tech Assistance
• Land and structures • Height and area of buildings • Inspections and code demand on specific businesses and type of production
What do Business Incubators provide to a start-up? (Small Business Chap 5 Incubators)
• Leases at or below market level rents • Managerial consulting • Mentor relationships • Low costs for shared general services
What are some potential problems & pitfalls of site selection for an incubator? (Small Business Chap 5 Incubators)
• Liability • Safety Problems • Heating/Cooling Efficiency • Costs and Taxes • Zoning • Location • Accessibility • Broadband Internet Access
Types of Entrepreneurial Networks? (Small Business Chap 6 Financing)
• Location-based Networks • Web-based platforms • Mentorship Networks • Commercialization Intermediaries • Financial Networks
Each incubator offers a set of services tailored to help tenants growh and develop. Examples? (Small Business Chap 5 Incubators)
• Logistical or Physical Services • Shared Office Support Services • Management Consulting Services
2 important steps to starting an incubator? (Small Business Chap 5 Incubators)
• Mission Statement (reason, scope of activities, direction, unique strengths) • Hire a Consultant to do the feasibility study!
Describe the legal entity Corporation (Small Business Chap 2 Tech Assistance)
• Most costly and complex kind of business to create • Separate legal body owned by shareholders • Shareholders elect board of directors to operate and control the corporation • Liability is on Corporation not shareholders • Lots of paperwork • Shareholders are independent legal entities • Corp is taxed twice for their profits and dividends paid to shareholders • Taxes are paid at a lower rate than an individual • Function of corporation not affected by the death of an investor • More credibility with banks and lenders • Need articles of incorporation
What is the NMSDC and what is the purpose? (Small Business Chap 2 Tech Assistance
• National Minority Supplier Development Council • Business membership organization focuses on creating partnerships among small minority owned businesses and corporations that wish to purchase goods and services • They grant certification to Minority and Women owned businesses, small disadvantaged businesses or underutilized businesses to ensure they are eligible for targeted programs.
Provide a summary of the Spotlight on: Generation E Institute (GENEI)? (Small Business Chap 2 Tech Assistance)
• Non-profit organization in Michigan, that offers youth entrepreneurial education programs and services for schools and community based organizations. GENEI focuses on building youth entrepreneurship education through its project objectives. • The program utilizes existing organization's input, community leaders, mentors and businesses to introduce entrepreneurial activities into new or existing programs.
What are Virtual Incubators? (Small Business Chap 5 Incubators)
• Operate without a building • Focus on IT industries with heavy reliance on web & ecommerce • Provide clients with networking opportunities and business expertise
What four basic areas do incubators assist their tenant businesses? (Small Business Chap 5 Incubators)
• Organization/Environment • Multi-tenant Real Estate • Business Consulting Services • Shared Office Services
What services do Chambers of Commerce provide? (Small Business Chap 2 Tech Assistance)
• Primary advocates for businesses in a designated area • Focus on issues facing local firms • A voice in the legislature and community • Keep businesses up to date on issues that are important • Referral services • Workshops • One-on-one counseling
What are Business Incubators? (Small Business Chap 5 Incubators)
• Proactive economic development tools • Take advantage of economies of scale that occur when several businesses are located under one roof • Strive to accelerate the successful development of new ventures • Lower start-up costs
What are the 4 P's of Marketing? Elements of a Business Description (Small Business Chap 4 Biz Plan Dev)
• Product - what product/service is, how it will fill unmet needs • Price - multiplied cost pricing, expected share pricing (competitive), Perceived Value Pricing • Placement-offering the product in the right place, getting the product in the consumers hand (direct sales, distribution) • Promotion - Advertising (radio, mail, newspaper), personal sales (face to face), public relations (public events / free media), social media networking (FB and Twitter, linkedIn etc.)
Debt Financing is common among what type of business? (Small Business Chap 6 Financing)
• Product-based Businesses
Name 3 Entrepreneurial based programs from the SBA? (Small Business Chap 6 Financing)
• SBA Office of Advocacy • US Business Advisor • SBA Online
How does an incubator differ from the SBDC? (Small Business Chap 5 Incubators)
• SBDC: o Mandated to assist anyone requesting services o Must provide service at any stage of development o Do not target early stage companies o Clients are generally 90% service and retail, not product based • Incubators: o Selective o Usually focus on high-growth potential businesses o Focus on high job-creation/high wage potential companies
What are the basic criteria commonly used by entrepreneur training programs for participant selection? (Small Business Chap 2 Tech Assistance
• Self-selection • Target group characteristics • Commitment • Merit of the business idea • Informal judgement about the candidates personal situation and ability to complete the program
What does SCORE stand for and what is it? (Small Business Chap 2 Tech Assistance)
• Service Corps of Retired Executives • An organization of working and retired business executives and business owners who volunteer as mentors for those trying to grow their own business. They are dedicated to educate entrepreneurs and promote the formation, growth and success of small businesses.
