Entrepreneurship and Business — How young companies raise money and what they give up for it.
A startup is a young company built to grow fast around a new idea. Getting there usually takes money, and how you raise it matters.
Bootstrapping: Funding the business yourself from savings and revenue, without outside investors. You keep control but grow slower.
Equity: Ownership of the company, usually in shares. Raising money by selling equity gives investors a piece of the business.
Venture investors give cash in exchange for equity, betting on big growth. That fuel comes at the cost of ownership and some control.
If investors pay $1,000,000 for 25 percent, the whole company is implied to be worth $4,000,000. That is its valuation.
12 practice questions with explanations. Free, and no account is needed to start.