Chapter Name: Identify alternative sources to secure finance for a new venture
Description:Explores crowdfunding, angel investors, and other non-traditional finance sources.
Purpuse:To widen financing knowledge beyond banks.
Rational:Helps ventures secure funding through creative or emerging means.
Chapter Assessment
Scope of Practical Skill
Key Requirement 1: Identify alternative sources to secure finance for a new venture
Learners should explore and identify alternative financing sources such as crowdfunding, angel investors, or venture capital.
Assessment Questions
Assessment 1 : The difference between debt (loans) and equity (owner's capital) is explained with reference to the new venture.
Learners must research and explore various sources of equity financing beyond traditional bank loans (e.g., venture capital, crowdfunding, angel investors).
Assessment 2 : Problems faced in obtaining finance for the new venture are identified with a view to overcoming them.
Learners investigate both government and private sector funding schemes and analyze their pros and cons for new ventures.
Assessment 3 : Alternative sources of equity are investigated for the new venture.
Learners must explain the concept of leasing and how it can help reduce the upfront capital required to start a business.
Assessment 4 : Government and non-governmental schemes for new venture creation are investigated and analysed and an explanation given of their advantages and disadvantages for the new venture.
Learners must research and compare interest rates, repayment schedules, and other terms of alternative financing options against those offered by banks or other traditional lenders.
Assessment 5 : The option of leasing as a method of reducing start-up capital is considered for own venture.
Learners must outline the steps and systems necessary to ensure timely payments to suppliers, following company standards.
Assessment 6 : The repayments and interest rates of the alternative options are considered and compared to those of the financial institutions to make informed decisions.
Learners must describe a process for timely processing of staff and casual labor payments, ensuring they meet company standards.