TYPES OF VENTURES-START-UP

START-UP
The following paragraphs will provide you with further information regarding start-up.

(a) Definition of Start-up
A Start-up Company is a company that is recently formed. It is a process where the entrepreneur creates a completely new business starting from scratch. Some of these businesses are created as follows:
• Many entrepreneurs start-up their business by themselves.
• Usually entrepreneurs will use their own funds from their savings or by borrowing from others.
• An entrepreneur who wants to start-up his businesses usually needs to have lots of experience, knowledge, skills and interest in the field involved.
• Start-up business usually involves the invention of new products or services.

(b) Phases in Start-up
Any new venture goes through three types of phases. They are the prestart-up phase, start-up phase and poststart-up phase. Figure 6.2 shows the three phases in start-up.
However, the major focus in the new venture development is only during the prestart- up phase and start-up phase. In both of these phases, five critical factors are important for new-venture assessment and they are as follows:
1. The uniqueness of the venture.
2. The investment size at start-up.
3. The expected increase in sales and profits as the venture cruises through the start-up phase.
4. The availability of products at the two phases.
5. The availability of customers during the two phases.

(c) Advantages and Disadvantages of Start-up
There are a few advantages and disadvantages of Start-up. Table 6.1 indicates those
advantages and disadvantages.

TOPIC 6 STARTING A NEW ENTREPRENEURIAL VENTURE

INTRODUCTION
This chapter will examine types of ventures that the entrepreneur can start the legal structures for new business ventures, and sources of capital for entrepreneurs.

OBJECTIVES
At the end of this topic, you should be able to:
1. explain the types of ventures;
2. describe the phases in the start-up;
3. examine the steps and processes in the buying of an existing business ventures;
4. identify the advantages and the disadvantages of the start-up and buying of an existing
business venture;
5. examine the franchise structure, advantages and disadvantages;
6. discuss the legal structures for new ventures; and
7. identify the sources of capital for entrepreneurs.

In the United States of America, studies indicate that more people are working to start their own business than getting married or having babies! One out of every 25 adults is actively involved in trying to start a new business.

Zimmerer and Scarborough, Entrepreneurship and Small Business Management

This chapter will examine types of ventures that the entrepreneur can start the legal structures for new business ventures, and sources of capital for entrepreneurs.

OBJECTIVES
At the end of this topic, you should be able to:
1. explain the types of ventures;
2. describe the phases in the start-up;
3. examine the steps and processes in the buying of an existing business ventures;
4. identify the advantages and the disadvantages of the start-up and buying of an existing business venture;
5. examine the franchise structure, advantages and disadvantages;
6. discuss the legal structures for new ventures; and
7. identify the sources of capital for entrepreneurs.