Module 6

Question 1

Strategic Planning

Answer 1

A process to determine the mission, objectives, and strategies of a venture or organization and then find ways to achieve the identified vision.

Question 2

Angel Capital

Answer 2

Investments in a new venture made by wealthy individuals (angels)

Question 3

Mission Statement

Answer 3

A brief written statement of the vision and purpose of a venture or an organization

Question 4

Accounts Payable

Answer 4

Payments due to suppliers for products and services

Question 5

Intrapreneur

Answer 5

A manager within a firm tasked with fostering innovation through entrepreneurial activities

Question 6

Venture Capital (VC)

Answer 6

Investments in new ventures with exceptional growth potential

Question 7

Private Placement

Answer 7

A method of raising capital through securities sold without a public offering (to select private investors)

Question 8

Creativity

Answer 8

The generation of new ideas by individuals and teams

Question 9

Partnership

Answer 9

A legal structure of co-ownership between two or more people who go into business together and share in any profits or losses

Question 10

Intrapreneurship

Answer 10

The entrepreneurial process conducted within an established organization

Question 11

Accounts Receivable

Answer 11

Money due from clients for products delivered or services performed

Question 12

Resource-based theory

Answer 12

A model advanced by Jay B. Barney and Delwyn N. Clark that focuses on the competences and capabilities of the firm in creating competitive advantage

Question 13

Debt financing

Answer 13

When an entrepreneur borrows cash and agrees to pay back the lender the original loan amount, plus a premium, by an agreed upon future date

Question 14

Social Innovation

Answer 14

The creation of innovative solutions to complex social problems

Question 15

Sole proprietorship

Answer 15

The simplest legal structure where the sole owner is not legally distinct from the business

Question 16

Entrepreneurship

Answer 16

The process of innovating with products or services for the purpose of creating wealth for the entrepreneur while adding value to society

Question 17

Innovation

Answer 17

The process by which new ideas are converted into new products, business practices, and strategies that create value

Question 18

Strategy

Answer 18

A plan of action designed to achieve specific goals or objectives in the venture

Question 19

Social Entrepreneurship

Answer 19

The process of developing innovative solutions for society’s most pressing social problems using entrepreneurial tools and techniques

Question 20

Equity Financing

Answer 20

When an entrepreneur receives cash from from an investor in exchange for equity in the company

Question 21

Commercialization Strategy

Answer 21

The strategic choices an entrepreneur makes to finance later-stage development of a venture

Question 22

5 Common Commercialization Strategies

Answer 22

1. Equity Investment
2. Strategic Alliance
3. Acquisition
4. Licensing
5. Initial Public Offering

Question 23

Equity Investment

Answer 23

Commercialization strategy which includes one or more investors in later stage equity financing round

Question 24

Strategic Alliance

Answer 24

Commercialization strategy in which there is a partnership with complementary business that benefits both parties in some way

Question 25

Acquisition

Answer 25

Commercialization strategy in which there is a purchase of the company by another business entity

Question 26

Licensing

Answer 26

Commercialization strategy in which one is supplying rights to proprietary ideas, products to other businesses in exchange for payment

Question 27

Initial Public Offering (IPO)

Answer 27

Commercialization strategy in which the company stock is made available to investors of all types and sizes via the public markets

Question 28

SWOT Analysis

Answer 28

A strategic analysis of a venture's strengths, weaknesses, opportunities, and threats

Question 29

Elevator Pitch

Answer 29

The quick, succinct summation of an entrepreneurial opportunity

Question 30

Serial Entrepreneur

Answer 30

An entrepreneur who starts multiple business over time

Question 31

Corridor Principle

Answer 31

The idea that new ventures can surface new and unintended market opportunities

Question 32

Market Niche

Answer 32

The subset of the market on which a specific product or service is focused on

Question 33

S Corporation

Answer 33

If there are less than 100 shareholders who own the same stock, a business can seek exemption from corporate income taxes and yet retain some key benefits (limited liability). Structured to limit federal income taxes on small businesses (no corporate income tax on earning)

Question 34

Limited Liability Company (LLC)

Answer 34

Fewer restrictions than an S Corporation. No limit to shareholders. Company members are taxed personally on profits.

Question 35

Business Plan

Answer 35

Includes production, finance, facilities, human resources management. Should have between 10-12 sections and 50 pages is ideal length

Question 36

Personal Cash

Answer 36

Funding the venture through credit cards, home equity, second mortgage, family/friends

Question 37

Internal cash

Answer 37

Funding the venture through accounts receivable and accounts payable. LESS EXPENSIVE THAN EXTERNAL CASH

Question 38

External Cash

Answer 38

From banks and financial companies (reluctant to give, high-cost)