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Funding/Business Suports (Income sources (Initaial investment, Loands,…
Funding/Business Suports
Equity and Valuation
being valued higher than a realistic figure can lead to failure of a company; Case Study: LetsBuyIt.com (.com bubble)
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Investors
Very much interested in the financial operations of the company.. net income, etc. Doing a bad job at this may result in investments not being made so this is important. Employing people to do this may be a wise move!
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Operating as part of a co-op can help keep costs down. Co-op is useful for businesses that work well together but cannot comfortably operate on their own (for financial reasons, such as the number of employees required to carry out a task that is already provided by another similar sized company)
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Selling directly to consumers, Case Study: "Dell" - Hybrid between direct sales and retail market
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Customers get the product for a more competitive price; extra retailer's expenses are not included in the cost of a unit
Customer gets to customise the components that go into their computer/laptop more than they would by buying through a retailer
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Business in itself
Case Studies: TechStars, Y Combinator
Offer financial support and mentorship to starting entrepreneurs in return for a varied percentage of equity (TechStars; not mentioned) (Y Combinator; 6% for $17,000)
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