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| Preface | |
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| Introduction | |
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| The Importance of Knowing the Numbers | |
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| Measuring Success | |
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| What Is Entrepreneurial Finance Management? | |
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| What Makes Entrepreneurial Finance Similar to Traditional Finance? | |
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| What Makes Entrepreneurial Finance Different from Traditional Finance? | |
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| How the Lack of Historical Data and Liquidity Complicates the Practice of Finance in Early Stage Firms | |
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| Using Stakeholder Analysis to Guide Ethical Decision Making | |
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| Summary | |
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| Building a Financial Forecast | |
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| Setting Financial Goals | |
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| Wealth Versus Income | |
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| Integrating Nonfinancial Goals into the Business | |
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| The Importance of Self-Assessment | |
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| The Self-Assessment Process | |
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| The Business Model and Business Plan | |
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| Summary | |
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| Individual Entrepreneurial Self-Assessment | |
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| Partnership and Shareholder Assessment | |
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| Understanding Financial Statements | |
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| The Accounting Equation | |
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| An Example | |
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| Basic Financial Statements | |
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| The Limitations of Business Financial Statements | |
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| Summary | |
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| Revenue Forecasting | |
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| Common forecasting Mistakes | |
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| The Link Between the Marketing Plan and Revenue Forecasts | |
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| Creating Scenarios | |
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| The Link Between the Revenue Forecast and the Cash Flow Forecast | |
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| The Impact of Business Type on Revenues | |
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| Quantitative Forecasting Techniques | |
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| The Importance of Revenue Forecasting | |
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| Summary | |
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| Expense Forecasting | |
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| Defining Costs | |
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| Cost Behavior | |
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| Breakeven Analysis | |
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| Expense Forecasting: Impact of Business Type on Expenses | |
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| Reducing Expenses Through Bootstrapping | |
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| Summary | |
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| Integrated Financial Model | |
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| The Entrepreneur's Aspirations Reconsidered | |
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| Contribution Format Income Statement | |
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| Earnings Before Interest and Taxes | |
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| Inventory of Assumptions | |
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| Social Ventures | |
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| Determining the Amount of Funds Needed | |
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| Using the Forecasting Template to Determine the Amount of Funds Needed | |
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| Time Out of Cash | |
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| Assessment of Risk Sensitivity | |
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| Integrating Financial Forecasts into Business Plan or Funding Document | |
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| Summary | |
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| Instructions for Using the Integrated Financial Statements Template | |
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| Managing the Financial Resources of a Venture | |
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| Monitoring Financial Performance | |
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| Tracking Assumptions | |
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| Establishing Milestones | |
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| Using Numbers to Manage | |
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| Financial Statement Analysis | |
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| Ratio Analysis | |
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| Working with Accountants | |
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| Summary | |
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| Day-to-Day Cash Flow Management and Forecasting | |
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| Why Is Cash Flow Different from Net Income? | |
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| Why Is an Accural-Based Income Statement Important? | |
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| How Is Cash Flow Measured? | |
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| Interpreting a Statement of Cash Flows: Direct Method | |
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| Statement of Cash Flows: Indirect Method | |
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| Investors' and Creditors' Use of the Cash Flow Statement | |
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| Effective Cash Management | |
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| The Emotional Side of Cash Flow Management | |
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| Summary | |
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| Sources of Financing | |
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| Financing Over the Life of a Venture | |
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| Common Misconceptions About Entrepreneurial Financing | |
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| The Diverse Nature of Business Financing | |
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| Financing Small Businesses with Modest Growth Potential | |
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| Financing High-Growth, High-Potential Ventures | |
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| Summary | |
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| Start-Up Financing from the Entrepreneur, Friends, and Family | |
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| Self-Financing | |
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| Advantages and Disadvantages of Self-Financing | |
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| Friends and Family Financing | |
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| Structure of Funds Invested | |
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| Summary | |
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| Bootstrapping | |
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| Why Bootstrap? | |
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| Bootstrapping Administrative Overhead | |
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| Bootstrapping Employee Expenses | |
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| Bootstrapping Operating Expenses | |
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| Bootstrap Marketing | |
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| The Ethics of Bootstrapping | |
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| Summary | |
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| External Sources of Funds: Equity | |
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| Angel Investors | |
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| Strategic Partners | |
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| Private Placement | |
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| Crowdfunding | |
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| SBIC | |
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| The Downside of Equity Financing | |
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| Working with Outside Investors | |
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| Summary | |
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| External Sources of Funds: Debt | |
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| Short-Term Debt | |
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| Long-Term Debt | |
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| Forms of Debt Overlooked by Entrepreneurs | |
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| Government Funding Through SBA | |
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| Working with Bankers | |
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| The Downside of Debt | |
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| Developing a Financing Plan | |
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| Summary | |
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| Financing the High-Growth Business | |
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| Integrating Profitability into the Business Plan | |
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| Stages of the Firm | |
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| Stages of Business Funding | |
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| The Dark Side of Venture Capital Financing | |
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| Initial Contact with a Venture Capitalist | |
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| Initial Public Offering | |
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| The Process of the IPO | |
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| Summary | |
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| Planning for the Entrepreneur's Transition | |
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| Business Valuation | |
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| General Concepts That Guide the Determination of Value | |
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| Basic Information Required for a Valuation | |
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| Discounted Cash Flow | |
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| Market Comparison Techniques | |
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| Summary | |
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| Exit Planning | |
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| Self-Assessment Revisited | |
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| The Ethical Side of the Entrepreneur's Transition | |
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| A Model of Exit Planning | |
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| Exit Options | |
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| The Process of Selling a Business | |
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| Postexit Issues | |
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| Summary | |
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| Index | |
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| About the Authors | |