Case 2 Able Planet
The difficulties entrepreneurs face when raising between over $100,000 for their businesses4 Ways Kevin Semcken can raise $1.5 million in capital5
Memo to Kevin Semcken7
This paper will analyze Case Study 2 Able Planet. In this case study, Kevin Semcken, Able Planet’s CEO and chairman is seeking capital to finance existing operations for its current products, build a prototype for a new product and market both products to new and current customers (Scarborough, 2012). Furthermore, Able Planet is unable to secure financing from a bank due to a predicament in the economic markets which has all but closed shut the lending opportunities at most commercial banks. Information that will be evaluated includes the following:
•Why entrepreneurs face difficulties when trying to raise between $100,000 and $3 million for their businesses •Ways Kevin Semcken can raise $1.5 million in capital by use of both debt and equity financing •What should be done before approaching potential lenders and investors in order to maximize the chance of getting needed capital
The difficulties entrepreneurs face when raising between over $100,000 for their businesses Capital is the lifeline of any business; it supplies the funds to expand, grow and make a promising business idea into a money-making enterprise. However, many entrepreneurs miscalculate how difficult it is to obtain financing for a business venture and get annoyed by this step of the business startup process. Nevertheless, investors and banks have plenty of reasons to be wary of financing especially it involves several thousands of dollars. Some of the reasons that entrepreneurs have issues when trying to raise large sums of capital include: •Most small business fail: According to Channon (2012), “More than 50 percent of businesses fail within the first...