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Venture Capital

Subject : industries
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Corporation's first offer to sell stock to the public - Allows for anyone to buy stock and now falls under the SEC (No longer accredited investor) ...






2. Money used to purchase equity-based interest in a new or existing company. A venture capitalists return usually comes from preferred stock - a share of profits - royalties or capital appreciation of common stock. Most venture capitalists look for c






3. How you get to vote






4. Financing for a company expecting to go public usually within 6-12 months; usually so structured to be repaid from proceeds of a public offerings - or to establish floor price for public offer.






5. The rate of return or profit that an investment is expected to earn.






6. The repurchasing of all of a company's outstanding stock by employees or a private investor. As a result of such an initiative - the company stops being publicly traded. Sometimes - the company might have to take on significant debt to finance the






7. The value at which an asset is carried on a balance sheet (the cost of the item)






8. This word is used to describe businesses that are in trouble and whose management will cause the business to become profitable so they are no longer in trouble.






9. The sale or exchange of a significant amount of company ownership for cash - debt - or equity of another company.






10. 'I will buy stock at price we negotiate'






11. The valuation of a company prior to a round of investment. This amount is determined by using various calculation models - such as discounted P/E ratios multiplied by periodic earnings or a multiple times a future cash flow discounted to a present c






12. Assets are subject to double taxation - Unlimited number of investors






13. The investigation and evaluation of a management team's characteristics - investment philosophy - and terms and conditions prior to committing capital to the fund.






14. An investment vehicle designed to invest in a diversified group of investment funds.






15. The residual ownership in a company like a corporation or LLC 51%=control






16. A study of the background and financial reliability of the company - management team and industry.






17. Shares acquired in a private placement are considered restricted shares and may not be sold in a public offering absent registration - or after an appropriate holding period has expired. Non-affiliates must wait one year after purchasing the shares






18. These are government-chartered venture firms that can invest only in companies that are at least 51 percent owned by members of a minority group or person recognized by the rules that govern this to be economically disadvantaged.






19. A form of equity ownership in a corporation that contains preferences over common stock - stock whose holders are guaranteed priority in the payment of dividends but whose holders have no voting rights






20. These are short-term financing agreements that fund a company's operation until it can arrange a more comprehensive longer-term financing. The need for these arises when a company runs out of cash before it can obtain more capital investment though l






21. Individuals that provide venture capital to seed or early stage companies. They can usually add value through their contracts and expertise.






22. A subsequent investment made by an investor who has made a previous investment in the company - generally a later stage investment in comparison to the initial investments.






23. An agreement issued by entrepreneurs to potential investors to protect the privacy of their ideas when disclosing those ideas to third parties.






24. Raising funds by offering ownership in a corporation through the issuing of shares of a corporation's common or preferred stock.






25. The process whereby a group of venture capitalists will each put in a portion of the amount of money needed to finance a small business.






26. The company or entity into which a fund invests directly.






27. A business owned by stockholders who share in its profits but are not personally responsible for its debts






28. Equity securities of companies that have not 'gone public' (are not listed on a public exchange). Private equities are generally illiquid and thought of as a long-term investment. As they are not listed on an exchange - any investor wishing to sell






29. An investment in a startup business that is perceived to have excellent growth prospects but does not have access to capital markets. Type of financing sought by early-stage companies seeking to grow rapidly.






30. The sale or distribution of a stock of a portfolio company to the public for the first time. IPOs are often an opportunity for the existing investors (often venture capitalists) to receive significant returns on their original investment. During peri






31. How much the company is worth before an investment






32. A financial institution specializing in the provision of equity and other forms of long-term capital to enterprises - usually to firms with a limited track record but with the expectation of substantial growth. The venture capitalist may provide bot






33. An IPO that has met certain






34. Purchase of a business by an outside team of managers who have found financial backers and plan to manage the business actively themselves.






35. An extremely concise presentation of an entrepreneur's idea - business model - company solution - marketing strategy - and competition delivered to potential investors. Should not last more than a few minutes - or the duration of an elevator rid






36. First to absorb losses. Represents common shareholders' investment in a company. It includes common stock value - retained earnings - capital surplus.






37. Used to compute net worth as the difference between total assets and total liabilities. adjusted value up to reflect market value






38. Funds provided to enable an enterprise to acquire another enterprise or product line or business.






39. The event in which the company is liquidated or sold (bankruptcy or sale to a public company)






40. Partner who does not share in a firm's management and is liable for its debts only to the limits of said partner's investment






41. Cash - stock and other property by the company to the investor in the investor's capacity as a stock - payment to owner for their appreciation






42. When an investor sells a stock - bond or mutual fund at a higher price than he or she paid for it.






43. The final event to complete the investment - at which time all the legal documents are signed and the funds are transferred.






44. An Agreement made between the investor and the company defining the rights and obligations of the parties involved. The process by which one arrives at the final term and conditions of the investment.






45. These are equity securities of companies that have not 'gone public' (in other words - companies that have not listed their stock on a public exchange). Private equities are generally illiquid and thought of as a long-term investment. As they are no






46. The total value of the company immediately prior to the latest round of financing






47. An acquisition of a business using mostly debt and a small amount of equity. The debt is secured by the assets of the business.






48. A detailed document that outlines what you are going to do and how you are going to do it - including a clear and simple discussion of the idea; the management team - including full resumes; business strategy; marketing plan - including sales projec






49. This refers to a public offering subsequent to an initial public offering. A secondary public offering can be either an issuer offering or an offering by a group that has purchased the issuer's securities in the public markets.






50. The sale of the assets of a portfolio company to one or more acquirers when venture capital investors receive some of the proceeds of the sale.