The Accidental Entrepreneur Essay

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What happens when your paychecks stop? I am no longer employed. Perhaps this is the time for me to pursue self-employment! Starting a small business in this tough economy won’t be easy. But after experiencing workplace bullying, the most devastating experience any employee can be subjected to, I am willing to consider the risks. Bhide (1999) found in his research “most startups derive from individuals seeking self-employment rather than the conduct of an entrepreneurial effort to develop new products, markets, technologies, and so on” (p. 19). Starting a business involves planning, making key financial decisions, and completing a series of legal activities. In order to obtain start-up financing, an entrepreneur has to convince…show more content…
Your relationship continues as long as you owe the money, and once it is paid back, your relationship with the lender ends. Debt financing can be short or long term. This type of financing can be personal savings, family and friends, banks, government guaranteed loans such as the Small Business Administration, and offices of economic development. The advantages to debt financing include control over the destiny of the business, own all the profit, and the interest on debt financing is tax deductible. The disadvantages to debt financing are too much debt can cause problems. If you begin to rely on it, and do not have the revenue to pay it back, it will make you unattractive to investors who will view you as "high risk." Equity financing is the type of financing in which there is an exchange of money from a lender for a piece of ownership in the business. This type of financing normally occurs with venture capitalists and angel investors. Venture capitalists are mostly interested in companies that have a solid track record and are expected to grow. Angel investors are people who are looking for an investment that will give them a better return than traditional investments. The financial plan or forecast is a crucial part of the business plan that most venture capitalist and angel investors look for. It comprises of three main parts: the balance statement (which summarizes a company’s assets, liabilities,

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