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Accounting and Finance

155 results found

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Letter of Intent: Form of Consideration
6/1/2007
Summary:

When selling your company be sure you understand the offering price might not match the value of your company and the deal is probably more complex than it seems. Pitfalls include nature of a stock deal, stability of the purchasing company, and tax implications. Best advice: Cash is still king!

Go To Source (www.feld.com)
Managing Your Cash Flow
6/4/2007
Summary:

This tool provides a detailed look into the various sections of a cash flow statement. It also describes two methods used to calculate cash flow from operating activities, indirect and direct with examples that will give you an edge when it comes time to preparing a cash flow statement of your own.

Go To Source (www.regions.com)
Cash Is King in Strategic Bootstrapping
7/19/2007
Summary:

Successful bootstrapping requires getting your hands on cash and managing it wisely. This article points out uncommon sources of ready cash that go unused--negotiating extended payment terms from suppliers, for example.

Go To Source (www.atdc.org)
Financial Leadership Saves Money
7/12/2007
Summary:

You might not see accounting as the most interesting part of your growing business, but it is critical to success. If you don't want to be the CFF (Chief Firefighter), bring the right financial leadership on board sooner, not later.

Go To Source (www.inc.com)
Financing an Acquisition
7/12/2007
Summary:

This well-written article gives practical advice on how to think about acquisitions and five no-nonsense tips on how to do them productively for all concerned.

Go To Source (www.entrepreneur.com)
Getting Paid
7/12/2007
Summary:

Inc.com provides an excellent collection of 21 links to resources that can guide your management and collection of receivables.

Go To Source (www.inc.com)
Valuation Worksheet
7/1/2007
File Resource
Summary:

During a round of investment in seed- (start-up) and early stage companies, angel investors typically invest from $25,000 to $100,000 each. The round usually totals between $250,000 and $1 million, and the company valuations run from $1 million to $3 million. Collectively, the angels purchase from 20 to 40 percent of a company’s equity and seek a return of 20-30x over five years.

Since the Internet bubble burst, the pre-money valuations of seed-stage companies by venture capitalists have averaged between $1 million and $3 million. Angel investors tend to participate at earlier investment stages than VCs, so pre-money valuations for angel deals nearly always fall into this admittedly wide range. What factors within this range impact the valuation of a specific company?

The accompanying Valuation Worksheet provides entrepreneurs and investors with an empirical basis for deciding if a start-up company should be valued near the top or bottom of the range. It’s not designed to be used for definitive valuation calculations.

The Valuation Worksheet lists major factors and key issues to consider in judging the value of a seed (start-up) company. Note the following features:

  1. The major factors are listed roughly in order of importance.
  2. Each major factor has been assigned a weighted ranking. For example, the “Strength of the Management Team” is worth 30 percent while “Sales Channels” are worth 10 percent. Investors put greater emphasis on the management team and the size of the opportunity than they do other factors.
  3. Within each major factor, the impact of each issue has been assigned a valuation ranking from +++ (very positive) to - - - (very negative), to assist the investor decide the overall weighted ranking to be assigned to the valuation. Some factors, such as the size of the opportunity (scalability) and coachability of the entrepreneur, can be deal killers.

Entrepreneurs can use the worksheet to gain insights into what investors are looking for in a fundable seed-stage company and to identify factors that justify higher pre-money valuations. The worksheet is also a roadmap on how entrepreneurs can improve the fundability of their enterprises and increase the pre-money valuation.

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The 5-Point Plan to Check Out Potential Investors
8/7/2007
Summary:

Stolen software, too-high brokerage fees, out-and-out scams are just a few of the pitfalls entrepreneurs must avoid as they raise capital. This article explains key signs of trouble and what to do about them.

Go To Source (www.angel-investor-news.com)
The Art of Projections in a Dotcom 2.0 World
8/16/2007
Summary:

Facing facts and forgetting fantasies are vital to accurate forecasting for startups seeking outside investment. This highly practical blog entry provides eleven helpful tips for doing forecasts realistically and presenting them in ways that investors understand and appreciate.

Go To Source (blog.guykawasaki.com)
The Best Funding Source for You
8/16/2007
Summary:

This article provides an excellent framework not only for how to raise money but also for how to think about raising money. Key point: Always stay nine months ahead of your need for cash.

Go To Source (www.entrepreneur.com)

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