chapter 9

Question 1

what are the stages of startup funding

Answer 1

1. self and friends and family
2. angel investors
3. vc otehr institional
4. IPO

Question 2

what is a best effort IPO

Answer 2

• used mostly for smaller IPOS
• the underwritter doesnt garuntee that the stock will be sold but tries to sell the stock for the best possible price

Question 3

what are two advantages of going public

Answer 3

greater liqidity and better access to capital

Question 4

what source of capital often demand a great amount of control

Answer 4

venture capital firms

Question 5

what form of funding is good for early stages and often provides expertise

Answer 5

angel investors

Question 6

how to find how much the company is worth with the stock

Answer 6

find the total amount of shares issues add them up
then find the most recent pruchase and divide the amount spent by total shares

Question 7

Which of the following statements is NOT true regarding venture capitalists

Answer 7

They might invest for strategic objectives in addition to the desire for investment returns