Why shouldn’t companies use equity for working capital requirements?

Companies requiring funds can categorize all their requirements essentially into two buckets, debt financing and equity financing. Typically, debt financing involves borrowing funds from a bank or from the general public by issuing bonds. Equity financing includes selling shares of stock or taking on additional owners. The one common mistake entrepreneurs make is thinking that these …

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Sole Proprietorship vs. Partnership vs. Corporate vs. Limited Liability Company – Various ways of forming a business organization

How Do Investors Decide – How Much Equity They Need, How Many Shares To Issue, How To Price The Share?

Ignore the first two slides if you're unaware of the methods.

Startup Valuations – How is a value of a startup calculated?

Common Stock vs. Preferred Stock

Stock represents the equity ownership of a company. In the startup world, there are two types of stock broadly: common stock and preferred stock. Common stock is usually something is given in exchange for your effort (sweat stock) whereas preferred stock is something that is given in exchange of the money that you invest in …

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Different ways to create value – product, dollar, speed, convenience

Traditionally, they say there are four ways of creating value: Product Cost/Price Speed Convenience Entrepreneur magazine says that there are three ways of creating value - Price, Quality and Speed. Remember the days when places like printing companies and auto body shops posted cartoons that showed an employee laughing hysterically, accompanied by a line like, "You …

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Vesting of Founder’s Stock

This is a post written by George Deeb and the link to the original article is here. Founders of a startup are frequently surprised when venture capital firms or other investors ask for vesting provisions to be placed on the founders’ stock.  The investors are seeking to provide sufficient incentive for each founder to work …

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One Line On Why Entrepreneurship?

Because it helps you realize your fullest potential. 🙂

Why the team means more than the idea in a start-up?

Ideas are a dime a dozen, at least in the start-up world. Paul Graham once said that ideas mean something, but execution means far more. He also said that if he provided the entire idea to a team and the team executes the idea, he would still be entitled to less than 10% of the company.  …

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How start-up equity dilution works for Founders and Early Investors ?

Startups typically have three broad ways of funding their companies. They are incubators/accelerators, angel investors, and venture capitalists (institutional investor). Generally, Incubators and Accelerators help the start-up team to set-up the company, and shape the start-up's Go-To-Market strategy. This article is limited only to explain how the equity dilution works and won't get into the …

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B-plan to pitch to the VCs

Though I have no experience in pitching to the VCs, I have written this based on my theoretical knowledge, and based on the inputs given by some of my acquaintances. My experience always taught me that people always want things very plain and simple. Though there are a hundred things to take care of in …

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Myntra.com is currently among the top e-commerce companies in India. Recently, they started above the line (ATL) advertising with the television commercial(TVC) below. As most of us know, if you have the pockets, a TVC is probably the best way to create awareness of your brand in India. Myntra.com TVC on air Going on TV …

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Manufacturing Challenges in India

I've read this article in Electronics Bazaar magazine and I thought it would be good to share some of the insights here. The world today sees India's economy growing into what's expected  to be one of the biggest global economies by mid-century. Although India is still viewed by manufacturers as an economy where the risks …

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People spend most of their time in the day around spaces like office, apartment, school and gym. Let us say, you need the book 'The Da Vinci Code' to read over the weekend. Most probably you will ask some people in your office, a few acquaintances in your apartment, and if they don't have the book you will go and buy …

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Starting a Microfinance business in India

Setting up a microfinance institution in India.

Online booksellers in India, Flipkart leading the way

Flipkart is an ecommerce website which sells books in India. It was setup in Sept 2007 and it has over 400,000 titles with a whopping 5 million monthly uniques, and a new round of cash from Accel in the bank. If you are an avid book reader there is a good chance that you have …

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