Index

Acceptance of failure, 18

Accounting, key personnel attributes, 140–141

Accounts payable, 124

Accounts receivable, 123

Address, choosing, 45

All-encompassing, 7

Amortized vs. interest, 117

Angel funds, 4

Angel investors, 113

A/R turnover ratio, 127

Assets

vs. liabilities, 123–124

ratio analysis, 146–147

sale leasebacks, 114

Assumptions, 117

Atmosphere of dread, 18

 

Balance sheet, 123–124

Blame, shifting, 19

Blaming instead of acting, 18–19

Blanket loans, 118

Break-even point, 69

Budget, creating, 55

Business

basic principles

business theories, 36–37

market analysis and research, 40–41

market opportunity, 38–39

planning to exploit niche market, 39

pre-start-up to-do list, 37–38

stages of business life cycles, 41–43

substitutes for idea, 40

choosing products and services, 60

supply–demand model, 60–61

evaluating ideas, 57–58, 59

expanding, 106–107

handling serious issues, 107

identity, 49

life cycles, stages of, 41–43

opportunities and pitfalls, 58–59

reasons for failure, 58

theories, 36–37

 

Capital raising presentation

funding stages

seed capital, 131

start-up capital, 131

two rounds of financing, 131

working capital loans, 131–132

funding steps, 129

presentation

general guidelines, 132–133

management illustrations, 133–134

proposal evaluation, 129–130

evaluation, 130

filtering, 130

screening, 130

selection, 130–131

Capitalized company, 3

Cash, 123

Cash flow

problems

corporate mistakes, identifying, 21–24

issues causing, 22–23

looking at additional mistakes, 23–24

projections, 125–126

Collateral pledges, 118

Commercial papers, 113–114

Company name, choosing, 45

Competition

analysis of, 66–67

selecting strategy, 67–68

complementary products, 53–54

creating budget, 55

developing plan, 54

establishing a mission, 54

making living document, 55

SWOT analysis, 54

Competitive advantage, ability to sustain, 81–82

Complacency, 3

Complementary products, 53–54

Compliance, 49

Conservative request, 117

Consultants, 74–75

Continuity, 75

Contradictory methods

creative approach, 32–33

formal analysis, 31–32

Controllable expenses, 121

Convertible debt, 115

Core values, 19

Corporate

image, 142

mistakes, identifying

cash flow, 21–24

fundamental historic truisms, 24–27

social responsibility, 49

strategy, 51–52

structure, 31

Cost–benefit analysis, 94–95

Costs

of sales, 120

start-ups, 88

Covenants, 118

Creative approach, 32–33

Creativity, defining, 32–33

Credibility, 18

Credit customers, treating, 76

Creditors’ days, 147

Current assets, 123

turnover, 147

Current liabilities, 124

Current ratio, 126, 136

Customers, 48

credit customers, treating, 76

 

Debt

coverage ratio, 127

equity, 112–113, 147

funding, 112–113

ratios, 147

structure, 104

to worth ratio, 126

Debtors’ days ratio, 146

Deception, 18

Decision trees, 94

Decision-making, 8

problem-solving, 92–93

steps, 91–92

strategic tools

cost–benefit, 94–95

decision trees, 94

force field, 93

paired comparison, 93–94

Pareto analysis, 93

plus, minus, and interesting, 94

tools vs. strategy, 91

Delegation of authority, 106

Direct competition, 66

Directives, traits and, 17–20

Directors’ details, 47–48

Downside planning, 117

Due diligence, 31

basic checklist, 141

contracts and agreements, 144

corporate image, 142

financial statements, 143

general, 142

marketing, 143

personnel, 143–144

 

Economies of scale, 103–104

Efficiency, 103

Egotistic behavior, 18

Employment, 75

Enterprises, forms of, 47

Entrepreneurs, 1–8

billionaire, personality traits of, 17–20

type of, 14–15

understanding, 15

Entrepreneurial groupings, 16

Entrepreneurship, defined, 35–36

Environmental factors, 81

Equipment leasing, 114

Equity, 112

debt vs., 112–113

Established companies, critical success factors for, 88–89

Experts, using, 24

 

Failure, acceptance of, 18

Feasibilities

analysis of competition, 66–67

selecting competition strategy, 67–68

financial viability, 69

market research, 69–71

market viability, 68–69

organizational structure viability, 65

process of, 63

technical viability, 64–65

Finance, key personnel attributes, 140–141

Finances and business, 109–110

amount requested, 116–118

deal negotiation, 116

financial projections, 110–111

funding available, type of

angel investors, 113

asset sale leasebacks, 114

commercial papers, 113–114

convertible debt, 115

debt vs. equity, 112–113

equipment leasing, 114

government or state bonds, 115

government small business loans and funds, 113

letters of credit, 114

limited partnerships, 115

lines of credit, 115

private placements, 115

purchase order advances, 114

receivable factoring, 114

stock market listing, 115

strategic partnerships, 113

venture capital, 113

funds to start a business, 111–112

total cash requirement, 110

Financial assessment, 31

Financial forecasts

income statement

controllable expenses, 121

cost of sales, 120

fixed expenses, 121–122

gross profit, 121

gross profit margin, 121

total net sales, 120

income statement worksheet

balance sheet, 123–124

cash-flow projections, 125–126

revenue projection, 122–123

key indicators and ratios, 126–127

projection information, 119–120

Financial problems

causes, 102–103

debt structure, 104

economies of scale, 103–104

efficiency, 103

identification, 101

liquidity, 102

profitability, 102

solvency, 102

Financial statements, 143

Financial viability, 69

Financing, two rounds of, 131

Fixed assets, 124

turnover, 147

Fixed costs, 53

Fixed expenses, 121–122

Force Field, 93

Forecasts, 69, 93. See also Financial forecasts

Formal analysis, 31–32

Funding. See also Capital raising presentation

stages

seed capital, 131

start-up capital, 131

two rounds of financing, 131

working capital loans, 131–132

steps, 129

 

General key personnel attributes

accounting and finance, 140–141

human resources, 141

management and key staff, 139–140

marketing and sales, 140

Goals, 51–52

setting, 52, 77

wishful vs. realistic, 24

Government or state bonds, 115

Government small business loans and funds, 113

Gross profit, 121, 122–123

margin, 121, 126

 

Hesitation, 3

Human resources (HR), 141

 

Income statement

controllable expenses, 121

cost of sales, 120

fixed expenses, 121–122

gross profit, 121

gross profit margin, 121

total net sales, 120

worksheet

balance sheet, 123–124

cash-flow projections, 125–126

revenue projection, 122–123

Indirect competition, 66

Insurance, 46

Interest payable, 124

Interest rate, 117

Internal matters, troubleshooting, 97–99

International Financial Reporting Standards (IFRS), 31

International Monetary Fund (IMF), 70

Investments, 123

 

Jungle Tactics’ research, 98

 

Key management, 139–140

Key managers, motivation, 107

Key personnel, 48

Key staff, 139–140

Knowledge and survival, 9–16

 

Legal factors, 81

Legal to-do list

address, choosing, 45

company name, choosing, 45

directors, shareholders, and other details, 47–49

forms of enterprises, 47

licenses, insurance, and taxes, 46

location and pricing, 46

Letters of credit, 114

Liabilities, assets vs., 123–124

Licenses, 46

Life cycles, business, 41–43

Limited partnerships, 115

Lines of credit, 115

Liquidity, 102

ratio analysis, 146

Location, 46

Long-term investments, 123

Long-term liabilities, 124

 

Macroaudit, 38

Management, 74

controls, 118

strengths and capabilities of, 81

visuals, guidelines for, 133–134

Market analysis and research, 40–41

Market opportunity, checking, 38–39

Market potential, 69

Market research, 69–71

Market viability, 68–69

Marketing, 143

key personnel attributes, 140

Medium-sized enterprises (SMEs), 67

Mission, 51–52

establishing, 54

 

Net profit margin, 126

Net worth, 124

Niche market

planning to exploit, 39

strategies, 67–68

Notes payable, 124

 

Organizational structure viability, 65

Ostentatiousness, 23

Overtrading

danger signs of, 136

defined, 135–136

solution to, 136–137

Owners’ equity, 124

 

Paired comparison, 93–94

Pareto analysis, 93

Payable days, 136

Payroll accrual, 124

Peer analysis, 68

Penalties, 117

Personal guarantees, 118

Personality traits of billionaire entrepreneurs, 17–20

Personality, 74

PESTEL analysis, 24, 31, 38, 80–81, 99–100

Pilot operation, 106

Plan, developing, 54

Plus, minus, and interesting (PMI), 94

Political factors, 80–81

barriers, 82

competitive advantage, ability to sustain, 81–82

differentiation, 82

prominence of company, 82

strengths and capabilities of management, 81

Porter’s Five Forces, 24, 31, 38, 67, 80, 81–82, 99–100

Pre-expansion rules, 105

pilot operation, 106

Prepaid expenses, 123

Pre-start-up to-do list, 37–38

Pricing, 46, 67

Primary data, 41

Priorities, developing

competition

complementary products, 53–54

creating budget, 55

developing plan, 54

establishing a mission, 54

making living document, 55

SWOT analysis, 54

making a profit, 52–53

setting goals, 52

vision, mission, and goals, 51–52

Private company, 47

Private placements, 115

Problem, 63–64. See also Financial problems

-solving, 92–93

Products and services, choosing, 60–61

Professionals, 74–75

Profit and loss. See Income statement

Profit making, 52–53

Profitability, 102

ratios, 147

Public company, 47

Purchase order advances, 114

 

Quick ratio, 126, 136

 

Rainmaker, 1, 12, 14, 32

pertinent issues questions, 29–30

Ratio analysis

assets, 146–147

debt ratios, 147

equations, 145–146

liquidity, 146

profitability ratios, 147

Receivable factoring, 114

Reputation enhancement, 49

Research and feasibility, 31

Respect, 19

Responsibility, not taking, 24

Return on equity, 147

Return on total assets, 147

Revenue, 120

projection, 122–123

Risk-to-reward analysis, 93

 

Sales, key personnel attributes, 140

Secondary data, 40–41

Section 21 companies, 47

Seed capital, 131

Self-explanatory, 106

Selling a stake, 118

Serious issues, handling, 107

Shareholders’ details, 48–49

Shares, 123

Short-term investments, 123

Shotgun approach, 23

Social factors, 81

Social media, 76

basic steps, 76–77

Social responsibility, 49

Solvency, 102

Staff, employing, 75

Stakeholders, 48

Start-ups

capital, 131

costs, 88

critical success factors for, 87

vs. established companies, 87–88

strategy rules, 89–90

Stock, 123

market listing, 115

repurchase, 118

Strategic partnerships, 113

Strategy

industry type, 99

internal matters, troubleshooting, 97–99

rules, 89–90

tools. See also specific tools

application, 84–85

comment on, 99–100

preferred types, 79–84

workshops, 31–32

Suppliers, 48–49

treating, 75–76

Supply–demand model, 60–61

Survival, knowledge and, 9–16

SWOT analysis, 31, 38, 54, 80, 83–84, 99–100

 

Taxes, 46

payable, 124

Team building, 73

consultants and professionals, 74–75

management, 73–74

Technical viability, 64–65

Technical visuals, 133–134

Technology factors, 81

Termination contracts, 75

Timeframe, 117

Tools. See Strategy, tools

Total asset turnover, 147

Total liabilities, 124

Total net sales, 120

Tough questions, 19

Truism, 21

fundamental historic, 24–27

Truth, 18

Two-pronged approach, 4

 

United Nations (UN), 70

 

Value add, 49

Value-added tax (VAT) legislation, 46

Value tone, setting, 23

Variable costs, 53

Vendors. See Suppliers

Venture capital, 113

Venture capitalists, 4

Vision, 51–52

 

Working capital loans, 131–132

World Bank, 70