Ebio enterprise living map

Financing the small business: You add value to others and exchange value including finance. (18 credits)

Financing a new venture (4.08)

Specific Outcome

Assessment criteria

Bridging the Gap

Ebio Competency Programme: Information and Examples

Organize and Review your competencies

Experts: Ben Theron, Barry du Plessis

There are a number of places on the web where you can find out about new venture funding, one of them: VentureWire

Biz/ed: Sources of finance

SO 1

Determine a new venture’s capital requirements.

J. Welch (Chap. 12: 189-204): Budgeting

AC 1.1

Funding requirements and capital structure are identified and analysed for new venture.

AC1. 2

Realistic fixed asset requirements are determined for a new venture.

AC 1.3

Pre-operating costs are identified and calculated to an exact value.

AC 1.4

Monthly operating costs – including cash flow statements – are compiled for new venture.

AC 1.5

Financial viabilities of proposed new venture operation is assessed and the break-point estimated.

SO 2

Identify and compare all funding options and services offered by the finance industry for a new venture.

Angel Venture Project Fund

AC 2.1

An extensive list of financial institutions offering funding for new ventures is compiled.

AC 2.2

Various funding packages (products) appropriate for a new venture are investigated and compared in terms of own venture structure.

AC 2.3

The cost of various funding options is compared to determine the suitability for own venture’s business structure.

AC 2.4

Short term and long term advantages and disadvantages of the funding options are considered and discussed in context of own business.

SO 3

Compile personal assets and liabilities statements.

AC 3.1

Prepare own income and expenditure statements based on own financial situation over past year.

AC 3.2

Situation when an assets/liabilities statement is required are listed and an indication is given of advantages of keeping such records.

SO 4

Identify the requirements and processes to successfully access the selected financing option for the new venture.

AC 4.1

The difference between debt (loans) and equity (owner’s capital) is explained with reference to the new venture.

AC 4.2

Problems faced in obtaining finance for the new venture are identified.

AC 4.3

Alternative sources of equity are investigated for the new venture.

AC 4.4

Government and non-governmental schemes for new venture creation are investigated and analysed.

AC 4.5

The option of leasing as a method of reducing start-up capital is considered for own venture.

AC 4.6

The repayments and interest rates of the alternative options are considered and compared to those of the financial institutions to make informed decisions.

SO 5

Identify alternative sources to secure finance for a new venture.

Sources of finance and investment

AC 5.1

The scope of the required external funding is determined.

AC 5.2

Alternative sources of venture capital is identified.

AC 5.3

A matrix of the costs and term structures of these alternative sources of venture capital is compiled.