Able Planet Case
Running head: Case 2 Able Planet
Case 2 Able Planet
Kelly Raines
Devry University
SBE 560 Contents
Abstract 3
The difficulties entrepreneurs face when raising between over $100,000 for their businesses 4
Ways Kevin Semcken can raise $1.5 million in capital 5
Memo to Kevin Semcken 7
References 9
Abstract
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
Case 2 Able Planet
Kelly Raines
Devry University
SBE 560 Contents
Abstract 3
The difficulties entrepreneurs face when raising between over $100,000 for their businesses 4
Ways Kevin Semcken can raise $1.5 million in capital 5
Memo to Kevin Semcken 7
References 9
Abstract
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
References: Channon, T. (2012). Why is it So Hard to Raise Capital When Starting a New Business?. Ehow. Retrieved August 10, 2012, from http://www.ehow.com/about_7448696_hard-capital-starting-new-business_.html Clifford, C. (2012, June 15). 9 Things Startups Must Know Before Approaching Lenders. Entrepreneur. Retrieved August 10, 2012, from http://www.entrepreneur.com/blog/223818 Rath, T. (2012). Debt and Equity Financing: Two Options for Financing Your Small Business. About.com. Retrieved August 9, 2012, from http://sbinformation.about.com/od/creditloans/a/debtequity.htm Scarborough, N. (2012). Effective Small Business Management. (10th ed.). (p. 812). Boston, MA: Prentice Hall.