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Exam 13: Other Financing Alternatives

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Question 31

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Venture banks seek loan returns from:

A) interest received
B) principal repayments
C) warrants being exercised
D) all of the above
E) none of the above

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Question 32

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Among start-ups, it is widely understood that bank debt outside of Small Business Administration loans), is not a very realistic source of financing for ventures with less than two years operating results.

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Question 33

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Compensation received by commercial loan officers makes them more likely to finance early-stage ventures.

"Pay-after-delivery" is a common model for obtaining funds from customers to help finance startups.

Commercial banks, jointly with not-for-profit Certified Development Companies, are lenders in which of the following SBA credit programs?

By an act of Congress, the Small Business Administration SBA) was created for the purpose of fostering the initiation and growth of small businesses.

Microloans in the SBA credit program are intended for very small businesses with a maximum amount of $35,000 to be used for general purposes.

In which of the following credit programs does the SBA borrow money to be lent Small Business Investment Companies SBICs) and guarantees payment to investors?

A seed accelerator is an organization that usually provides both an equity investment and a mentoring and educational fixed-term, cohort program to help startup companies succeed.

Factoring is the sale of payables to a third party at a discount to their face value.

Credit cards issued to start-ups have proven to be an alternative source of start-up financing.

Which of the following is/are not a type of leasing arrangement?

Factoring is the selling of receivables to a third party at a discount from their face value.

When assessing the creditworthiness of new entrepreneurs, lending institutions review the "Five C's". The money the entrepreneur has invested in the business, which is an indication how much is at risk if the business should fail is known as:

Which of the following is not a Small Business Administration program?

Collateral plays an important role in determining the willingness to lend and the amount and terms of the loan, making it the most important factor in the lending process.

The Immigration and Nationality Act INA) of 1990 provided an opportunity for foreign nationals to obtain a "green card" through the EB-5 immigrant visas program.

When assessing the creditworthiness of new entrepreneurs, lending institutions review the "Five C's". The general impression the entrepreneur makes on the potential lender or investor is known as:

Receivables lending is the use of receivables as collateral for an equity issue.

Which of the following is not a common characteristic of business incubators?