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Scenario Imagine you are in the process of starting your own business

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Scenario

Imagine you are in the process of starting your own business.  You have some savings of your own and you also have family that will help with financing.  However, you will need to obtain a source of financing for an additional $250,000.  

Discussion Instructions

Generate a sourcing plan for securing the necessary funds for your business and consider three angles: debt, crowdfunding, and equity.

Debt

For debt, research and compare the following sources:

• 2 local or community banks
• 2 commercial lending banks
• The Small Business Administration

In your comparison, identify the banks and examine and summarize:

• how much the lender typically extends,
• interest rates,
• how long will it take to get funded, and
• the lenders’ guidelines or requirements.

Based on the comparison, make a recommendation on which lender you would recommend when pursuing $250,000.  Support your decision with thoughtful analysis and explanation.

Crowdfunding

For crowdfunding, research and compare 2 crowdfunding platforms. In your analysis:

• Identify the 2 platforms, and 
• explain how crowdfunding on those platforms works. 

Equity

For equity, research and compare the following sources:

• 2 angel investing groups
• 2 venture capital companies
• term sheets

In your comparison, examine:

• the process to obtain equity funding,
• the difference between an angel investor and a venture capital firm, and 
• how term sheets work.

Based on your analyses and comparisons, make a recommendation for pursuing equity financing for $250,000.

You are free to use the templates provided or come up with something on your own.  The templates above are just a guide to assist you with summarizing your analyses.

Discussion Forum

In the discussion forum, based on your analyses and comparisons, summarize your:

• recommendations and reasoning for the selected lender, 
• recommendations and reasoning for the equity financing selection, and
• include your detailed research file.