There are 2 different types of financing capital available for companies. They are:
Debt & Equity
In the United States venture capital funding is often the first form of equity capital a company will receive.
False
Which of the following is NOT true of most debt financing structures?
Generally issued in shares of stock.
The term "dilution" in the context of equity finance is the process by which investors recover their investments.
False
With the exception of family and friends, an investor must fit the parameters of being an accredited investor in order to buy equity shares of a privately held company.
True
In regards to investment strategy, venture capital investors tend to be geographically focused as opposed to industry focused.
False
Which of the following is NOT considered to be a viable exit strategy for an investor?
Corporate Restructuring
A convertible debt agreement allows an investor to transition their equity shares to a debt note when certain milestones are reached, such as raising an additional round of financing.
False
One income based company valuation technique is to analyze the liquidation value of a company's assets if the pieces were sold on the open market.
False
From an investor's perspective, SAFE investment vehicles are stronger options than Convertible Notes because they allow for loan interest to be accrued prior to conversion to equity.
False