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1.1 Identify Your Financial Needs - IntroductionIf you're thinking of expanding your business, you'll probably need extra funds to help finance the cost. But how do you determine how much you'll need? Your own company will probably cover some costs, but, ultimately, you'll be borrowing from others. They'll want to know that you're a good risk. It's up to you to prove it. In Step 1, you take the first important step toward your business's growth. You will gain an understanding of the financial groundwork that must be done (on several fronts) and be better prepared to take actions that will move you forward. As you look at the scope of the financial work involved, you might decide that you're going to need help and advice from others. This Step will point out some likely resources for you to turn to. In any case, the overview you gain here will keep you on top of the process. If your finances are already carefully managed and in good order, you're beginning from a position of strength. Well-organized, thorough financial records are a critical starting point for the next levels of financial information you'll need to develop. And if you have good relationships with your banker, your accountant and your lawyer, their knowledge of your current business is another strength to build on. In This StepYou'll learn the basic process for figuring out how much money you'll need to fund your company's growth. The key activities are described in the pages that follow:
If you need a deeper understanding of the material, be sure to follow the links within each section. These links provide a more detailed explanation of financial statements. The New Tech StoryFollow the fictional company New Tech Distributors Corp. (New Tech) as it pursues venture financing. This case example gives you a feeling for the "real" data and strategic decisions you'll be facing. You can always get to it through the link on the left menu bar.
Key QuestionsTo build an effective strategy to raise the capital you need, you should answer these questions:
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Updated: 2005/07/12 |
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