All Weeks Entrepreneurship 4: Financing and Profitability Quiz Answers
Entrepreneurship 4: Financing and Profitability Week 1 Quiz Answers
Quiz 1: Building a Business Model and a Customer Base Quiz
Q1. According to many entrepreneurs, what is the one key rule for success in entrepreneurship?
- Develop a robust business plan
- Find the right business partner
- Hire the right people
- Don’t run out of cash
Q2. What is an example of a disruptive business model?
- Foxconn
- Peapod
- Warby Parker
- Samsung
Q3. How is a business model different than a general strategy?
- A business model is an outcome of a strategy
- A strategy is a component of a business model
- A business model is not different than a general strategy
- A business model is a description, but a strategy is an action
Q4. Which of the following is not a kind of business model:
- Value Chain
- Disruptive
- Architecture
- Influencer
Q5. Why are business models important? (Check all that apply)
- They act as a checklist to make sure you are planning properly
- They accurately predict your profit
- They are asked for in bank loan applications
- They tell a story of how your company makes money
Q6. What is the best strategy for customers who are low value but active?
- Foster loyalty
- Minimize effort targeting these customers
- Targeted promotions
- Increase transactions
Q7. What is the CLV (net of acquisition cost) if customer acquisition cost is $600 and expected contribution is $350 per period for a total of 5 periods?
- $850
- $1,150
- $600
- $1,500
Q8. What is the CLV (net of acquisition cost) if customer acquisition cost is $600, expected contribution is $350 per period, and retention rate is 70% per period for a total of 5 periods (round to the nearest whole dollar)?
- $371
- $340
- $440
- $393
Q9. What is the CLV if the return is $350 per period, churn is 0.3, and discount rate is 0.1 for an indefinite number of periods?
- $1000
- $1,166
- $875
- $833
Q10. Research shows entrepreneurs are willing to accept a discount to work with a prestigious venture capital firm. According to Joseph Ansanelli, why are entrepreneurs choosing to do this rather than choosing other sources of capital?
- They value the specific experience and knowledge of an individual partner in the venture capital firm
- The venture capital firm can help them recruit talent
- The venture capital firm can help them connect to potential customers
- All of these are reasons to work with a prestigious venture capital firm at a discount
Entrepreneurship 4: Financing and Profitability Week 2 Quiz Answers
Quiz 1:Financing Methods and Valuation Quiz
Q1. On average, what is the largest source of funding for startups?
- Angel
- Self-funding
- Venture Capital
- Friends and Family
Q2. Who would typically use a convertible note when funding your business?
- Credit Card Companies
- Venture Capitalists
- Small Business Lenders
- Friends and Family
Q3. Which of the following statements about angel investments is true?
- Angel investors want equity in your company
- Angel investors are generally wealthy individuals interested in investing in startups
- All of these statements are true
- Angel investors are mostly interested in the seed stage
Q4. Which of the following financing pathways are NOT dilutive sources of funding?
- Venture Capital
- Super Angels
- Bank Loans
- Angel Investors
Q5. With each round of fundraising, approximately what portion of the company equity is given up?
- 10%-20%
- 10%-30%
- 10%-40%
- 10%-50%
Q6. Which of the following financing options typically provides the largest amount of investment?
- Accelerators
- Venture capital
- Super Angel
- Angel Investors
Q7. In 2012, which of the following areas received significantly more investments from angel investors than from venture capitalists?
- Retailing/distribution
- Consumer products and services
- Biotechnology
- Software
Q8. What is the post-money valuation if the pre-money value is $2M and an investor invests $4M?
- $6M
- $8M
- $4M
- $2M
Q9. Which of the following statements about convertible debt is not true?
- Investors who agree to convertible notes usually receive a discount in the very early stage of a business
- Although technically debt, convertible notes convert to equity later
- Convertible debt allows startups to raise money while delaying the valuation discussion
- Investors will not be able to put a limit on the valuation at which investors’ notes convert to equity
Q10. If a company raises a $5 million Series A round from an investor at a $20M post-money valuation, and later the company raises $10M at a $100M valuation, how much more must the investor invest to keep his/her original stake?
- $5M
- $1M
- $10M
- $2.5M
Entrepreneurship 4: Financing and Profitability Week 3 Quiz Answers
Quiz 1:Choosing Financing, and Calculating Breakeven Quiz
Q1. Which of the following are forms of startup financing?
- Venture capital and angel investors
- All of these are forms of startup financing
- Crowdfunding and bootstrapping
- Government grants and commercial banks
Q2. Two conceptual problems that plague the financing of startup type markets include ___ and ___.
- Negotiations; due diligence
- Valuation; bootstrapping
- Hidden information; hidden action
- Asymmetrical information; due diligence
Q3. Which of the following is true?
- Venture capital performance is almost always successful
- Entrepreneurs always take the highest financial valuation offer
- None of these are true
- Venture capitalists with a high reputation are three times more likely to have their offers accepted
Q4. As the founder of a company, you are more likely interested in which two types of crowdfunding?
- Charity and peer-to-peer lending
- Equity and reward based
- Peer-to-peer lending and equity
- Reward based and charity
Q5. To get the most out of crowdfunding, you should do the following EXCEPT ___.
- Hire outside consultants
- Understand your target audience
- Produce high quality videos
- Appeal to online communities
Q6. Which of the following is true about debt financing?
- Debt is generally less costly to founders
- None of these are true
- Debt requires you to give up an ownership interest
- Debt is usually subordinate to equity
Q7. All of the following are forms of debt financing EXCEPT ___.
- Factoring
- Convertible notes
- Venture capital
- Equipment financing
Q8. The burn rate is the ___.
- Net negative cash flow per unit time
- Total expenditure per month
- Projected balance of cash out into the future
- Amount of cash you have on hand before you run out of money
Q9. Breakeven time refers to ___, whereas breakeven quantity refers to ___.
- Time to payback original investment; units per time required to make a profit
- Time to positive cash flow; units per time required to make a profit
- Time to pay back original investment; units per time required to recover fixed cost
- Time to positive cash flow; units per time required to recover fixed cost
Q10. Which of the following is an issue with calculating breakeven?
- Margin cannot be calculated
- Does not take variable costs into account
- Assumes fixed level of spending
- Cannot be calculated for non-physical items
Entrepreneurship 4: Financing and Profitability Week 4 Quiz Answers
Quiz 1:Strategies for the Pitch and the Exit Quiz
Q1. What is the goal for your pitch deck?
- To get to the next set of conversations
- To raise money
- To detail everything there is to know about your company
- To convince investors they will miss out if they do not invest
Q2. How should you NOT emphasize your solution in your pitch deck?
- Describe customers using your product
- Explain the benefits to the customers
- Be super product focused
- Use pictures and stories
Q3. Good executive summaries should ___.
- Include names of all the notable people you know
- Overstate numbers to make the opportunity look more attractive
- Be adapted according to what the investors already know
- Describe financials and your entire model in detail
Q4. All of the following are true of pro forma financial statements EXCEPT ___.
- They are an accounting of your actual financial performance
- They are usually supported by a more detailed budget for the next 12 months
- Analysis is generally done by month
- They include three standard forms: income statement, cash flow statement, and balance sheet
Q5. In preparing pro forma financial statements, start with the ___.
- Balance sheet
- Statement of equity
- Cash flow statement
- Income statement
Q6. Revenue and cost numbers in the model should be ___.
- Entered directly based on best estimates
- Multiplied by a constant multiplier from historical data
- Based on operating parameters of the business
- Based on numbers that are needed to achieve the desired results
Q7. All of the following are examples of stakeholder liquidity or exits EXCEPT ___.
- Debt financing
- Initial public offerings
- Buyout of shares
- Mergers and acquisitions
Q8. If organizational synergies and faster resource acquisition are more important to you, you may want to consider ___.
- Mergers and acquisitions
- Buyout of shares
- Initial public offerings
- Private ownership
Q9. A public offering may have potential disadvantages such as ___.
- All of these are true
- Higher costs, both direct and indirect
- It provides competitors with insight into your competitive position
- It is hard to time the market, and there is no objective threshold
Q10. If innovation is more important to you, you may want to consider ___.
- Private ownership
- Mergers and acquisitions
- Initial public offerings
- Buyout of shares
Get All Course Quiz Answers of Entrepreneurship Specialization
Entrepreneurship 1: Developing the Opportunity Quiz Answers
Entrepreneurship 2: Launching your Start-Up Quiz Answers
Entrepreneurship 3: Growth Strategies Coursera Quiz Answers
Entrepreneurship 4: Financing and Profitability Quiz Answers
