1 / 12

Small Business Finance…

Small Business Finance…. Spring 2010 URG MBA Program Chapters 1-3. Establishing a Venture . Most start-ups fail – Why? The idea Demand? Need? Benefit provided? Management Team Experience Example: CEO Larry Hsu Legal and Financial Advisors. Business Structure. Sole proprietor

lerato
Download Presentation

Small Business Finance…

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Small Business Finance… Spring 2010 URG MBA Program Chapters 1-3

  2. Establishing a Venture • Most start-ups fail – Why? • The idea • Demand? • Need? • Benefit provided? Management Team Experience Example: CEO Larry Hsu Legal and Financial Advisors

  3. Business Structure • Sole proprietor • Limited liability • Corporation • Partnership • LLC (Limited Liability company) • Each type uses different: • Documentation • Regulations/Laws/Taxation • SBA

  4. Financial and Business Planning • Business Cycle—What makes it tick • Financial Statements • Balance Sheet • Assets and Liabilities • Income Statement • Income/Revenue and Expenses/Costs • Cash flow Statements – Importance? • EBIT (Earnings Before Interest and Taxes) • Examples

  5. Accounting and Actual Cash Flow • Timing between sales and payment receipt • Cost of doing business • Credit card fees • Barters • Based on market price • Example: Web page design and maintenance/Advertising • Accounting depreciation • Leasing and relying on credit from suppliers

  6. EBITDA • Earnings before interest, depreciation and Amortization • Used in companies that have a high value in equipment • Disadvantage : does not include maintenance of equipment • Does not affect cash flow—does affect taxes and tax reporting

  7. Financial Projections • Forecasting cash needs • Valuation of the company • Compare actual performance to forecasts • Gives creditability and reliability to your forecast • Issues • Markets are difficult to predict • Promising a % increase must be substantiated • Conservative estimates or not?

  8. Policies • Pricing • What are some strategies? • R & D Cost • Credit • How much and to whom? • Establishing your own • Dividend • Affects cash balances

  9. Cost Structure Analysis • Break-even Point • Be conservative here • Establishing Fixed and Variable Costs • Fixed costs are easy to establish/consistent • Variable costs? • Energy Costs • Shipping, etc. • Establishing what could and/or should be outsourced • Cost of establishing your business network • Who will be your business partners?

  10. Strategic Planning • Market analysis/feasibility • Start-up costs • R & D costs • Consider target markets • Test market? • Decision making • Establish a process • Use a decision tree

  11. Strategic Alliances • Anti-trust issues • Go to Youtube.com and search for AT&T funny video Look for the one that looks like a diagram • Application to today’s markets? • Banking • Communications • Transportation • Car makers

  12. Business Plan • Great resource – SBA – www.sba.org • Components: • General description • Business goals • Product description/Service description • The management team • Current status • Summary of financial projections • Financial resource requirements

More Related