Structuring The Deal PDF

Subject Entrepreneurship
Segment Financial Elements

Topic Structuring the Deal
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Table of Contents
1. Overview
2. Deal Structure
3. Sharing the Risk
4. Finding Financing for Your Business
5. Self-Assessment
6. Summary
1. Overview
Whether it is at the very beginning of a venture's life, or over an extended period of
time, each firm will have its own capital structure. A rigorous exploration of the
nature and determinants of capital structure must be reserved for the subject of
finance. However, almost all capital structures will consist of debt and equity, neither
one being better or worse than another. Each has its advantages and disadvantages.
There is no "one best" capital structure for all firms because of all the trade-offs
required. Most businesses begin with the founders' own equity investments plus
some equity from family and friends. After this initial equity infusion, entrepreneurs
may want to look to borrow whatever they can secure. This is because debt is
relatively cheap. Interest rates on a loan may range from 10-20%, but the required
rates of return on equity investments might approach 30-50%. Debt is cheaper and
should be used first, if possible.
Let us review the advantages and disadvantages of debt.
The advantages of debt are

1. Less expensive for the entrepreneur (interest rates lower than return on
equity)
2. Imposes discipline for repayment
3. Can be rolled-over or re-issued
4. Can be re-negotiated when interest rates fall
The disadvantages of debt are
1. Must be repaid regularly
2. Non-payment can lead to bankruptcy
3. May not be available during tough economic times
4. May have to be re-negotiated when interest rates rise
5. Will require collateral
Let us review the advantages and disadvantages of equity.
The advantages of equity are

1. Does not require regular payments (dividends) to investors
2. Increases capacity for more borrowing (debt/equity ratio)
3. Does not expire or have to be re-negotiated
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4. Does not require collateral

The disadvantages of equity are
1. Is more expensive than debt (returns on equity exceed interest rates)
2. Gives outsiders legal rights concerning firm operations
3. Diminishes ownership share for founders
4. Diminishes founders control of the enterprise
This topic focuses on the various aspects of structuring a deal.

Objectives: Structuring the Deal
Upon completion of this topic, you should be able to:
 explain the various deal elements that can be offered to potential investors
 describe the strategies to be used for segmenting the investor market
2. Deal Structure
A deal structure organises the cash flows of the business and configures them for
each investor. In the following animation, you will be presented with a simplified deal
structure for a hypothetical biotech company that does genetic engineering. You will
explore the risk/reward attributes of various parts of the cash flow of this biotech
company and see how the investor market can be segmented.
In the following animation, you will be presented with a simplified deal structure for
a hypothetical biotech company that does genetic engineering. You will explore the
risk/reward attributes of various parts of the cash flow of this biotech company and
see how the investor market can be segmented.
Let us see how John Minor and Lillian Soong go about segmenting the investor
market to structure an appropriate deal.
Cash Flow Summary
John Minor and Lillian Soong are planning to set up a biotech company.
1. $2,000,000 is needed to fund the business. This is expressed as a negative
cash outflow.
2. The business operations will generate cash flow each year, including
$1,200,000 in year 5.
3. The business will have a 'terminal value' of $10,000,000 in year 5, which is
included in this number.
Cash Flow Breakdown
The cash flow will come from three sources. The Internal Rate of Return or IRR on
the cash flows is 59.46%.
1. The business will qualify for a tax incentive in the first 3 years. In years 4 and
5, income tax payments need to be made.
2. Free cash flow cash from operations less cash outflows remains positive and
rises during the 5 year period. .
3. Terminal value has been calculated by applying a price earnings multiple of
10 to the net cash flow for year 5.
Net Present Value

Net Present Value or NPV of each cash flow category is calculated by discounting the
cash flows back using the IRR of 59.46% as the discount rate. The NPV of the
investment component is $2,000,000.
1. For the tax cash flows, NPV = $383,383, which is 19.1% of the returns.
2. For the operational cash flows, NPV = $647,272, which is 32.4% of the
returns.
3. For the terminal value cash flow, NPV = $968,716, which is 48.5% of the
returns.
Wealthy Investor
Simon Lake is a wealthy investor. He is willing to invest in the business in order to
use the early period of tax losses to shelter his income from other investments.
1. Simon is interested in the tax cash flows and his targeted IRR is 20%.
2. Discounting the tax cash flows using a 20% discount rate results in $492,155.
3. The parties agree that the tax benefits flow to Simon. He will not get a true
equity position. In return, Simon agrees to invest $492,000.
Bank
John and Lillian approach Bio Finance Bank for a loan. The bank looks at the cash
flow projections and wants 10% interest payments annually and repayment of
principal in year 5.
1. Bio Finance bank determines that it is comfortable lending $1,000,000 with a
10% annual interest rate.
2. The parties agree to a $1,000,000 loan. The business will pay $100,000 in
interest each year for 5 years and will repay principal in year 5.
3. With the $492,000 tax deal with Simon and $1,000,000 loan from Bio Finance
Bank, John and Lillian only need $508,000 to reach their target.
Venture Capitalist
MuchRiskReturn is a venture capital firm. It is most interested in the riskiest part of
the deal, the terminal value, and it wants a minimal IRR of 50%.
1. The remaining cash flows must be used to raise the rest of the money needed
($508,000) and give John and Lillian their return.
2. The remaining discounted cash flow is divided by $508,000, the amount of
additional cash needed. The parties strike a deal under which MuchRiskReturn
gets 28.3% of the equity in return for a $508,000 investment.
3. By first going for the cheapest money, John and Lillian are able to work out
an optimal financing package for their business!
Simon's Return
Why is Simon willing to live with a 20% IRR in comparison with the 50% plus IRR
sought by MuchRiskReward? Identify the correct answer.
1. Compared with venture capital firms, individual investors have a relatively
weaker ability to assess risks and negotiate terms.
2. Simon is taking tax benefits, which are much more likely to accrue,
irrespective of how the business is doing.
3. Simon has structured a senior, secured position for himself. In case of
bankruptcy, his $492,000 will be paid out first.
Let us review whether you identified the correct answer.
1. Compared with venture capital firms, individual investors have a relatively
weaker ability to assess risks and negotiate terms. This may or may not be
the case. The evaluation and negotiation capability of different investors can

vary greatly.
2. Simon is taking tax benefits, which are much more likely to accrue,
irrespective of how the business is doing. That is correct. Simon is not taking
true equity risk and his benefit arises from being able to shelter his income
from other sources.
3. Simon has structured a senior, secured position for himself. In case of
bankruptcy, his $492,000 will be paid out first. This is not the case. Simon
does not have a senior, secured position, such as a secured lender would.
Bio Finance's Return
Why does Bio Finance not conduct a NPV analysis to determine its return? Identify
the correct answer.
1. Bio Finance is obtaining a fixed amount, $1,000,000 in principal repayment
and $100,000 each year in interest payments.
2. As a bank, Bio Finance is prohibited from taking an equity position in the
business.
3. NPV is an equity financing concept which does not apply to examination of
debt instruments.
1. Bio Finance is obtaining a fixed amount, $1,000,000 in principal repayment
and $100,000 each year in interest payments. That is correct. NPV is useful in
determining current values of future cash flows, which value can then be
divided among stakeholders. Bio Finance's return is fixed at repayment of the
principal plus an interest payment of 10% a year.
2. As a bank, Bio Finance is prohibited from taking an equity position in the
business. This may or may not be the case. In some but not all countries
there are restrictions on banks taking equity positions.
3. NPV is an equity financing concept which does not apply to examination of
debt instruments. This is not the case. Cash flows from debt instruments can
also be discounted back using the NPV method.
MuchRiskReturn's Return
Why is it appropriate for MuchRiskReturn to use its IRR as the discount rate? Identify
the correct answer.
1. The discount rate for NPV analysis is always the same as the IRR for
investment analysis.
2. Using the IRR as the discount rate enables MuchRiskReturn to put a current
value on a cash stream based on its target investment return.
3. MuchRiskReturn wants to use as large a discount rate as possible in order to
squeeze John and Lillian.
1. The discount rate for NPV analysis is always the same as the IRR for
investment analysis. This is not the case. There is no necessary correlation
between the discount rate and the IRR.
2. Using the IRR as the discount rate enables MuchRiskReturn to put a current
value on a cash stream based on its target investment return. That is correct.
If MuchRiskReturn buys the whole cash flow stream, it would want to ensure
its IRR was met.
3. MuchRiskReturn wants to use as large a discount rate as possible in order to
squeeze John and Lillian. This may or may not be the case. MuchRiskReturn
has a target IRR that it is trying to achieve.

3. Sharing the Risk
We have discussed relatively simple deals so far. More realistic deal structures take
into account the fact that for the most part investors are in control of the
negotiations - "whoever has the money, makes the rules". Investors are quite
schizophrenic. They fight a double battle between fear and greed. They fear they will
lose their investment and all their money. This makes them risk-averse. However,
they are greedy and want to make as much as possible, leaving nothing on the
negotiating table. This makes them want to take chances. The trade-off between
wanting to take few chances and wanting to maximise investment has led to a
number of complicated investment vehicles. Some of the complexities involved in
making a deal are illustrated in the following article.
Reading: How Venture Capital Works
This article gives an overview of the venture capital industry. The article discusses
some of the issues venture capitalists need to consider when making investments
and to ensure they meet their investors’ expectations at acceptable risk levels.
Bob, Z. “HOW VENTURE CAPITAL WORKS”, Harvard Business Review 76 issue 6
(Nov/Dec 98): 131-139
After reading the article, reflect on the following questions:
 The article suggests that the myth is that venture capitalists invest in good
people and good ideas, whereas in reality they invest in good industries.
Think about the reasons why this might be the case?
 In what ways do the various deal structures align the incentives of the
entrepreneur and the venture capitalist?
In order to be able to minimise risk and yet share the returns of a very successful
venture, investors will frequently demand:
 Convertible preferred stock that has elements of debt in the preferred part,
but can be converted to equity if the venture becomes very valuable.
 Staged financing that gives the investor a chance to see how things are going
before putting in more money. The delay increases investor return.
 Options to abandon the investment may leave the entrepreneur struggling,
but gives the investor an exit strategy.
 Warrants are a form of stock option that allow an investor to buy stock at
prices cheaper than the current value of the company. They are sometimes
referred to as an "equity kicker" in a deal, where the investor lends the
company money and receives warrants at a set price schedule. If the
company does well, the investor exercises the warrants and now owns more
valuable equity.
Table 8-7 Calculating the Value of a Warrant of the eTextbook presents the
calculation method for a warrant. Review the table and attempt the interactive
exercise below.

The Loan
Can you calculate the value of a warrant? The warrant is linked to a $2,000,000 loan
maturing in 3 years with a guaranteed return of 20% and a coupon interest rate of
12%.
Step 1: Determine CF
First, you calculate the cash flow interest payments. The cash flow interest payment
will be $240,000. The yearly interest cash flow is derived from the 12% coupon
interest rate.
Step 2: PV of the Interest
Second, you present value the interest cash flows at the discount rate. The Present
value of the interest will be $200,000, $166,667 and $138,889, respectively. This is
because the interest payments are discounted back at 20%.
Step 3: Cumulative PV
Third, calculate the cumulative present value for each year's return. The cumulative
PV for each year is $1,800,000, $1,633,333 and $1,494,444, respectively. The
cumulative PV for each year cumulates the PV for that year and all prior years.
Step 4: Future Payment
Fourth, calculate the future payment that will make the cumulative PV = 0 based on
the guaranteed return. The future payment that will make cumulative PV = 0 is
$2,582,400. This is the result of CPV = x / (1.20)3.
Step 5: Warrant Value
Fifth, determine warrant value by subtracting the future payment from the principal.
The warrant value is $582,400. The value is the total future payment less the
principal amount.
Let us summarise this steps in calculating a warrant.
Step 1, Determine CF
First, calculate the cash flow interest payments.
Step 2, PV of the Interest
Second, calculate the present value of the cash flows at the discount rate.
Step 3, Cumulative PV
Third, calculate the cumulative present value for each year's return.
Step 4, Future Payment
Fourth, calculate the future payment that will make the cumulative PV, which equals
0, based on the guaranteed return.
Step 5, Warrant Value
Fifth, determine the warrant value by subtracting the future payment from the
principal.

4. Finding Financing for Your Business

Let’s join James Chew as he goes through the process of estimating his financing
needs, the best sources for this financing and how to approach investors to get him
started.
James Chew
James Chew is an aspiring entrepreneur. From a chance meeting with Sabrina
Thompson, a legendary entrepreneur who started VignetteHides, a handbag retail
chain thirty years ago, he has learned about the traits and characteristics of an
entrepreneur; how an individual is driven by social factors to become an
entrepreneur; and the importance of creativity as an important capability for the
entrepreneur since it can be a source of sustainable competitive advantage.
James’ long time friend, Amy Hilfram who works at a marketing and brand-building
firm) has decided to join him in his new venture, Rice Harvest. With the help of
Sabrina, they have discussed and agreed on what should be included in the business
plan.
James and Amy have deliberated what goes into a business plan. Sabrina plays a
major role in the discussion and gives them pointers on the key elements of a
business plan. In this scenario, let's join James as he evaluates his financing needs,
the best sources for this financing, and how to approach investors.
Disclaimer: The companies, individuals and events referred to herein are fictional.
Any similarity to actual companies, individuals and events is purely coincidental.
James says, Sabrina, thanks for helping us out with the business plan. Now that we
have the financials in place, I can't wait to get started.
Sabrina says, I understand the feeling. But, you need to consider certain issues
before you decide on the financial elements of your business.
Amy says, I presume the business plan will detail the financial elements of the
business.
Sabrina says, That's true. But, strong preparation and planning can improve your
chances of finding financing. You need to put your business in the best possible
financial light to make a good impression on prospective sources.
Amy says, So, what are the essential factors that we should consider while looking
for financing?
Sabrina says, To find financing for your venture, you first determine what you need
and then find the right funding sources to provide it.
Many start ups go in for unsuitable sources of funding. Not only does this waste their
time, but they also lose on crucial funding opportunities. Along with James and Amy,
let us assess your knowledge of new venture financing. Identify whether the
following statements are true or false.
1. Bank loans are not a common source of small business start up capital.
2. When seeking a business loan, it is a good idea to apply with as many lenders

as possible.
3. Banks commonly make loans to loyal customers that are in the midst of a
cash flow crunch.
4. Your personal credit history will have an impact on your ability to find funding
for your business.
5. Venture capital is hardly ever available for small businesses.
Let us review whether you could identify the accuracy of these statements.
1. Bank loans are not a common source of small business start up capital. This is
true. Banks hardly ever make loans to small business start ups because,
without a history of successful financial management, a new business will be
considered too risky.
2. When seeking a business loan, it is a good idea to apply with as many lenders
as possible. This is false. Each request your business makes for credit shows
up on your credit report. As a result, applying to multiple lenders can hurt
your chances of receiving financing, since it may raise a red flag with a
financing source's risk management department.
3. Banks commonly make loans to loyal customers that are in the midst of a
cash flow crunch. This is false. A company's first inclination when it has cash
flow issues may be to go to a bank to request a short term operating loan or
line of credit or LOC. Unfortunately, this may be the worst time to seek funds.
Lenders are risk averse, and do not like hearing that a company is having
trouble paying its bills, even if the bank has worked with the customer before.
4. Your personal credit history will have an impact on your ability to find funding
for your business. This is true. A person whose personal finances are in shape
is more likely to be diligent when it comes to business finances. In addition,
banks are looking to mitigate risk, and, in many cases, will expect a business
owner to personally guarantee any business loan.
5. Venture capital is hardly ever available for small businesses. This is true.
While venture capital receives a lot of press, it is rarely a reliable source of
financing for small businesses. Venture capital financing is generally available
only to businesses that can demonstrate an extremely high rate of growth
and a management team experienced in building high growth companies.
Now, let's see Sabrina has to say about this.
Many start ups are not clear about where they can go to look for money. For
example, they may approach banks without knowing how lenders evaluate an
application, or may pursue venture capital when their businesses don't fit the fast
growth profile.
You may find yourself wasting time pursuing funding sources for which you are not
eligible. Take the time to understand your specific financing needs, and then clearly
analyse the different resources that are appropriate for your situation before seeking
financing for your business.
Amy says, Well, that did clear some of my doubts!
James says, We have already stated the amount of funding and the type of
investment we seek in our business plan.
Sabrina says, State the amount of funding and the type, debt or equity, of
investment you seek. It is important here to provide a breakdown of how the money
will be applied. Discuss what effect the capital will have on the potential of the
business to grow and profit, when the money is needed and what investment has
already been made in the company.

Here are a few tips for structuring your financial needs. Include the following
elements in your application for financing.
1. Minimum amount to participate
2. Capital and future investment
3. Payback period and return on investment
4. Collateral being offered
5. Current investors
6. Access to additional funding sources
7. What an investor could recoup via tax benefits
Let us look at how James and Amy have structured the financing needs for Rice
Harvest.
James and Amy suggest a US$3,000,000 total financial need. $500,000 from
founders, family friends, fools. $2.5 million outside financing. Bankable and asset
based collateral might be $1.5 million, leaving $1.0 million for risk capital investors.
James says, So, it looks like the next step is to look for investors for our venture.
Sabrina says, Yes. Now that you have calculated how much money you need to begin
and the choices for financing that you have, you need to move on. The next step in
the financing process is to sell the enterprise's plans, prospects and future
performance to investors to raise the money.
James and Amy have come up with a great idea, and have spent a lot of time
researching and polishing the original idea. Now, they are at a crucial juncture,
where they have to look for investors to ensure that their venture takes off.
Approaching the investor is a crucial process. Let's look at some key steps that
James and Amy must take in this process. Why don't you help them make the right
choice?
Before approaching investors, you need to create the documents that explain the
story of your new venture. As James and Amy prepare to reach investors, which
presentations do they need to organise?
Step 1, Organise the documents
Before approaching investors, you need to create the documents that explain the
story of your new venture. As James and Amy prepare to reach investors, which
presentations do they need to organise?
1. They need to get their business plan in shape. A 2 page summary and 25
page plan will grab the attention of investors.
2. Do they need a business plan? Do investors have time to review business
plans? A quick presentation can suffice.
3. They need a detailed business plan. They need to sell investors on their ideas.
Extensive research will impress the investors.
1. They need to get their business plan in shape. A 2 page summary and 25
page plan will grab the attention of investors. A concise, well thought out
business plan is the first step to success. A two page executive summary and
concise, well thought out business plan is the greatest sales package your
start up can put in front of an investor.
2. Do they need a business plan? Do investors have time to review business
plans? A quick presentation can suffice. A slide presentation alone is not
enough to convince the investors. A two page executive summary and

concise, well thought out business plan is the greatest sales package your
start up can put in front of an investor.
3. They need a detailed business plan. They need to sell investors on their ideas.
Extensive research will impress the investors. Investors don't have the time
to review all business plans. A two page executive summary and concise, well
thought out business plan is the greatest sales package your start up can put
in front of an investor.
Step 2, Finding professional advisors
In your early stages, James and Amy will be able to handle many of the basic start
up tasks without outside assistance. Should they hire some outside advisor?
1. They haven't actually started with a business, so they don't need an attorney
or accountant yet.
2. They should hire experienced legal and accounting professionals to advise
them on their business.
3. Both James and Amy have significant amount of experience and a network of
friends. Their personal contacts can review their financials, and once they
have the funding, they can find advisors with more experience.
1. They haven't actually started with a business, so they don't need an attorney
or accountant yet. It is crucial to hire an accountant and an attorney with
experience. Some of the best professionals are usually tied in with investor
sources. A letter of introduction or referral from your attorney or accountant
can open up financing doors for you.
2. They should hire experienced legal and accounting professionals to advise
them on their business. As discussed, it is crucial to hire an accountant and
an attorney with experience. Some of the best professionals are usually tied
in with investor sources. A letter of introduction or referral from your attorney
or accountant can open up financing doors for you.
3. Both James and Amy have significant amount of experience and a network of
friends. Their personal contacts can review their financials, and once they
have the funding, they can find advisors with more experience. Friends and
family are a great help, however, it is crucial to hire an accountant and an
attorney with experience. Some of the best professionals are usually tied in
with investor sources. A letter of introduction or referral from your attorney or
accountant can open up financing doors for you.
Step 3, Assembling the top management team
For Rice Harvest to move on the right track, James and Amy need to have talented
people in place. What would be the best strategy for building their team's strength?
1. Their funding will be dependent on having a top notch management team. So,
they must recruit one right away.
2. James and Amy have significant experience to get started. They will use
experienced outside advisors and consultants to help with key activities that
they can't manage. After they get financing, they'll start recruiting a
permanent team.
1. Their funding will be dependent on having a top notch management team. So,
they must recruit one right away. The experience and talent of a
management team is a major deciding factor for investors. However, credible
talent might not join without realistic outside investors. You can compensate
for this by providing a clear management recruitment strategy in your

business plan.
2. James and Amy have significant experience to get started. They will use
experienced outside advisors and consultants to help with key activities that
they can't manage. After they get financing, they'll start recruiting a
permanent team. The experience and talent of a management team is a
major deciding factor for investors. You can compensate for this by providing
a clear management recruitment strategy in your business plan. Investors will
view your ability to recruit strong advisors as an indicator of your
management team's leadership skills.
Step 4, Connecting with investors
Now that it's time to start contacting investors, what is the most useful way for
James and Amy to get their plan in front of investors?
1. They should send direct mailers to all investors they think will be interested in
their plan.
2. They should engage a consultant who will then look for funding sources for
them.
3. They should focus on a select group on investors, beginning with those their
professional advisors have already worked with.
1. They should send direct mailers to all investors they think will be interested in
their plan. On the contrary, this might hurt their chances of finding funding.
You will waste time sending out your plan to every investor. Many investors
exchange information, a plan rejected by one may influence others.
2. They should engage a consultant who will then look for funding sources for
them. It is recommended that you not use brokers and agents for your
funding requirements. Investors would prefer you to be present yourself and
not use any intermediaries.
3. They should focus on a select group on investors, beginning with those their
professional advisors have already worked with. Investors always trust
references. Your friends, family, old business colleagues and other resources
can also be tapped for leads to investors.
Step 5, Making your presentation
Now, if Rice Harvest's business plan interests an investor, where should James and
Amy focus their efforts in their presentation?
1. They should demonstrate how well they know their customers, what need
they will be fulfilling for their customers and why they will work with them
instead of their competitors.
2. They should walk the investors through their business plans. The investors
can then see the key features of the business idea and invest in it.
3. They should primarily focus on their numbers, investors are mainly interested
in how much money they can make out of the venture.
1. They should demonstrate how well they know their customers, what need
they will be fulfilling for their customers and why they will work with them
instead of their competitors. Investors want to know what makes you
different from all the other companies out there. This difference is responsible
for your venture's success or failure.
2. They should walk the investors through their business plans. The investors
can then see the key features of the business idea and invest in it. Investors
will not have the time to review the entire business plan. Instead, focus on

how you plan to execute sales and marketing. This is because investors want
to know what makes you different from all the other companies out there.
This difference is responsible for your venture's success or failure.
3. They should primarily focus on their numbers, investors are mainly interested
in how much money they can make out of the venture. You should not rely
solely on financial projections. Instead, focus on how you plan to execute
sales and marketing. This is because investors want to know what makes you
different from all the other companies out there. This difference is responsible
for your venture's success or failure.
This short scenario would have helped you determine how to evaluate your financing
needs, locate the best sources for this financing and the process to approach
investors.
Here is a brief overview of the things to keep in mind while approaching investors.
 Use references. Investors always trust professional referrals and are easy to
convince for funding.
 Successful entrepreneurs know that finding financing for a start up is a form
of selling. Therefore, you should focus on how you plan to execute the sales
and marketing functions in your new venture.
 Organise your documents such as business plans and cash flow statements.
 Hire professional advisors to advise you on legal and accounting issues of
your new venture.
5. Self-Assessment
Now, try the self-assessment questions to test your understanding of the topic. Click
the following link to open the Self-Assessment in a new window.
Self-Assessment
Q1. Which of the following would an investor NOT negotiate for as one of the
conditions of providing financing?
1. Convertible preferred stock
2. Callable warrant
3. Staged Financing
4. Option to abandon
5. Warrants
Q2. Which of the following is NOT one of the advantages of debt over equity
financing?
1. Can be less expensive for the entrepreneur
2. Imposes discipline for repayment
3. Can be rolled over or re-issued
4. May be negotiated if interest rates fall
5. Interest payments can be easily omitted if profits are down

6. Summary
This topic covered the following points:
 The capital structure of any firm will include both debt and equity, and each of
these types of financing has its advantages and disadvantages.
 The entrepreneur's task is to segment the investor market by matching the
type of cash flow generated by the business to the preferences and
characteristics of the investor.
 Investors have developed additional vehicles that enable them to increase
their returns when the business is a big success. Since investors are often in
control of the negotiations, entrepreneurs should be aware of these
investment instruments.
Credits and Disclaimer
Microsoft is a registered trademark of Microsoft Corporation in the United States and/or other countries.
Netscape and Navigator are registered trademarks of Netscape Communications Corporation.

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Subject Entrepreneurship

Segment Financial Elements

The advantages of debt are

Let us review the advantages and disadvantages of equity.

The advantages of equity are

Copyright © 2015, GlobalNxt University. All rights reserved. 1 of 13

4. Does not require collateral

This topic focuses on the various aspects of structuring a deal.

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3. Sharing the Risk

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4. Finding Financing for Your Business

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