Forms of Business Ownership
This is the most common form of business ownership in the U.S., where a single individual owns the business and is personally responsible for all its debts.
What is a Sole Proprietorship?
This is usually the very first place an entrepreneur looks for money based on personal relationships rather than a formal business plan. Name the source AND one pro and one con.
What are Friends, Family, and Fools?
This section of a business plan identifies the specific group of people or organizations a business aims to reach and serve.
What are Customer Segments?
This Harvard dropout co-founded Microsoft and became one of the world's wealthiest people and most prominent philanthropists.
Who is Bill Gates?
Spell the word for: An organization that provides for the wants and needs of consumers by selling goods and services, using human, material, information, and financial resources.
What is Business? (B-U-S-I-N-E-S-S)
In this legal arrangement, two or more people share profits and losses, but they also share "unlimited liability," meaning their personal assets could be at risk for business debts.
What is a Partnership?
This method involves raising small amounts of money from a large number of people, typically via internet platforms like Kickstarter or Indiegogo. Name the source, AND one pro and one con.
What is Crowdfunding?
This section identifies the network of suppliers and partners that help the business function, reduce risk, or acquire resources.
What are Key Partners?
Known as a master "Strategist," this co-founder of Apple was famously fired from his own company before returning years later to launch the iMac, iPod, and iPhone.
Who is Steve Jobs?
Spell the word: Refers to money that is borrowed and must be paid back with interest.
What is Debt? (D-E-B-T)
This popular business structure protects owners from personal liability but allows profits to be taxed only once on the owners' personal returns.
What is a Limited Liability Company (LLC)?
Unlike selling ownership, this source requires the business to pay back the original amount plus interest. Name the source, AND one pro and one con.
What is a Bank Loan?
These are the most important assets required to make a business model work—such as physical buildings, intellectual property, or human talent.
What are Key Resources?
This co-founder of Nike started by selling running shoes out of the back of his car at track meets before building a global empire.
Who is Phil Knight?
Spell the word: Describes a type of funding where you sell a piece of your company to investors in exchange for cash.
What is Equity? (E-Q-U-I-T-Y)
This business structure acts as a separate legal "person" in the eyes of the law; it provides owners, who are sharholders, with the strongest protection against personal liability but is subject to double taxation.
What is a Corporation?
This is an affluent individual who provides capital for a business start-up, usually in exchange for ownership equity, often acting as a mentor, investing less than $150K. Name the source, AND one pro and one con.
What is an Angel Investor?
This is a single, clear message that states why your business is different and worth buying from.
What is the Unique Value Proposition or Value Proposition?
This Australian entrepreneur was rejected by over 100 investors before her "simple" graphic design platform, Canva, became a multi-billion dollar success.
Who is Melanie Perkins?
Spell the word: Refers to an asset (like a house or a car) that a borrower offers to a lender to secure a loan. If the loan isn't paid back, the lender can take this asset.
What is Collateral? (C-O-L-L-A-T-E-R-A-L)
Name both: This first form is owned and operated by its members for their mutual benefit, while the second is a for-profit entity that commits to creating a positive impact on society or the environment.
What are a Cooperative (Co-op) and a Benefit Corporation (B-Corp)?
Name both: This first source is "free" money from the government or a foundation that doesn't need to be paid back, while the second comes from professional firms that invest large sums of money into high-growth startups in exchange for equity ownership.
What are a Grant and a Venture Capitalist (VC)?
Name both: These two sections at the bottom of the plan track all the expenses needed to run the business and the various ways the business will generate cash.
What are Cost Structure and Revenue Streams?
The founder of Patagonia, he started as a mountain climber making his own gear and famously "gave away" his company to a trust to fight climate change.
Who is Yvon Chouinard?
Spell the word: describes the act of setting up a business or businesses, taking on financial risks in the hope of profit. Includes be willing to fail and persevere.
What is Entrepreneurship? (E-N-T-R-E-P-R-E-N-E-U-R-S-H-I-P)