NVC Chapter 12: Financial Resources

15 cards   |   Total Attempts: 182
  

Cards In This Set

Front Back
Crowdfunding
Peer-to-peer, internet-based lending or investing. Also includes ‘rewards’ platforms.
Collateral
The assets pledged against the possible default on a loan.
Lease
A form of finance that allows the firm to use the asset without owning it by making regular payments.
Hire purchase
A form of finance that allows the firm to purchase the asset over a period of time by making regular payments with the asset acting as security.
Factoring (or invoice discounting)
A form of finance where sales invoices act as security.
Breakeven point
Fixed costs divided by contribution margin, expressed in $/£ of turnover.
Agency theory
Identifies the mechanisms and costs that the principal has to put in place to ensure that the agent conforms to a legal agreement.
Business angels
Private equity investors.
Venture capital
Equity capital invested in the business by individuals or institutions other than the founders at an early stage in its development.
Management buy-ins
External managers buying a firm and normally replacing the management.
Management buy-outs
The management of a firm buying it.
Exit route (liquidity event)
The sale of an equity investment.
Liquidity event (Exit route)
The sale of an equity investment.
Trade sale
Sale of the business to another company, probably in the same industry.
FinTech
The financial technology industry. This includes crowdfunding platforms and other internet platforms that deliver financial services.