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Evaluating Business Opportunities V1

Assignment A
1 If you're trying to buy a going service business, how can you figure a
reasonable price for the business that takes into account goodwill and business
contacts in addition to the value of equipment and inventory?
2 If you have money but no particular business in mind, how can you get enough
information on the best business to go into?
3 How do you start a tech startup as a non-technical person?
4 If I estimate my start-up cost at $50,000 and can't put up anywhere near the
$25,000 that I've been told is what I should have for my share, am I wasting my
time even filling out a loan application?
5 Why would someone be "compelled" to purchase a company's product or service?
What specific needs does it address?
6 How does an S corporation extend its income tax return due date?
7 Can an S corporation can be set up without an attorney or accountant?
8 How would you go about establishing price guidelines for a business renting
items to customers?

Assignment B

Case study
Although Aavishkaars investment and support played an essential role in growing
Saraplast from a $600,000 to $2.5 million revenue company providing toilets for
over 200,000 people, a majority of whom were first-time users, Kher has two
criticisms of Aavishkaar. First, he expected Rai to spend more effort influencing
Indian policymakers to require toilet access at construction sites and other areas,
which Kher views as essential to serving Indias population of over 500 million who
have never used a toilet. Second, Kher expressed frustration that a tension exists
between Aavishkaars interest in selling its stake in Saraplast at a high valuation
and a desire to make follow-on investments in the firm at a reasonable valuation.
They offered me follow-on financing at a valuation they would not accept if they
were selling their stake, Kher reflects. I dont fault them for trying to get a
good dealas a business owner, I too negotiate to try to get good deals [when
making investments]. But we went elsewhere for additional funding.
Ultimately, though, Kher has had a very positive experience with Aavishkaar. Their
most important contribution was connecting us with people who helped develop the
reputation as a serious sanitation services company providing high impact services
to the bottom of the pyramid. RESULTS: In AIMVCFs 2007 PPM, Aavishkaar outlined
three performance scenarios ranging from 11 percent to 18 percent IRRs for LPs. As
of March 2013, after six complete exits, two partial exits, and three write-offs,
and taking into account the fair market value of its remaining portfolio, AIMVCF
had a gross IRR of over 20 percent and a roughly 13 percent net IRR, in line with
the funds target financial
performance. Table C includes details on exits, 2013 portfolio valuations, and fund
returns.
Aavishkaars exit strategy was to sell underperforming investments to company
founders and
promoters, and to sell holdings in high-performing companies to other investors,
including
mainstream venture capital firms seeking to develop their presence in rural India.
According
to Pradeep, the idea was that by selling to, or partnering with, mainstream
investors, portfolio
companies such as Vortex Engineering, a manufacturer and distributor of ATMs in
rural areas,
could remain faithful to their social goals.
Our objectives are very closely aligned with mainstream investors. For example,
Vortex makes
possibly one of the worlds cheapest ATM machines. In India, the penetration of
ATMs is so
skewed toward the big cities that you would hardly see any ATMs in the small towns
in India. The
smaller towns of India are precisely where the next big opportunities are arising.
So mainstream
investors can see this as a pure commercial opportunity, while we see this as
fulfilling a very basic
social infrastructure need. The reason these mainstream funds are interested is
because they see
the emerging opportunities in these smaller towns. If the companies are successful
here, they
represent a huge commercial opportunity as well as a large social impact, Pradeep
explains.

Q.No 1: What are the basic hygiene challenges handled by saraplast, Pune?

Q.No 2: Which company provided support to saraplast and how?

Q.No 3: What was the exit strategy for Avishkaar?

Assignment C

1 The bottom line of any business plan is:

(A): Marketing plan
(B): Financial plan
(C): Personnel plan
(D): Production plan

2 Top management works on:

(A): Strategic plan
(B): Corporate plan
(C): Budgeting
(D): Both a & b

3 "Strategic plan' often refers to as:

(A): Long term plan
(B): Short term plan
(C): Both A and B
(D): None of the above

4 The plan which is discussed firstly in business plan:

(A): Marketing plan
(B): Financial plan
(C): Personnel plan
(D): Production plan

5 In the planning process, the first step is to:

(A): Set an objective
(B): Evaluate alternatives
(C): Determine strength & weaknesses
(D): None of the above

6 The design strategy of business includes

(A): marketing strategy
(B): technology strategy
(C): sourcing strategy
(D): all of above

7 An area that company can profitably satisfies according to buyers need is called:
(A): marketing opportunity
(B): production opportunity
(C): new market
(D): new customers

8 The analysis of opportunities and threats is included in:

(A): internal environment
(B): external environment
(C): market environment
(D): product environment

9 When a company agrees to promote product of any other company's market offering
is best classified as
(A): product alliance
(B): service alliances
(C): promotional alliances
(D): logistic alliances

10 When a firm offers logistical services for some other company's product, it is
said to be:
(A): logistic alliance
(B): production alliances
(C): raw materials alliance
(D): employee alliances
11 The second step in marketing research process is:
(A): define research objectives
(B): develop research plan
(C): implement research plan
(D): none of above

12 The research based on hypothesis suggestion and problem definition is classified

as:
(A): casual research
(B): exploratory research
(C): descriptive research
(D): both a and c

13 The primary data which is gathered by observing relevant actions and people is
called
(A): experimental research
(B): ethnographic research
(C): observational research
(D): survey research

14 The process of watching customers in natural environment is called:

(A): experimental research
(B): ethnographic research
(C): observational research
(D): survey research
15 The collection, analysis and reporting of available data for any given marketing
situation is classified as:
(A): external databases
(B): outsourced databases
(C): marketing research
(D): both a and b

16 It is the job of ________ to produce insight into the customer's attitude and
buying behavior.
(A): Marketing Researcher
(B): Marketing Planner
(C): Marketing Personnel
(D): None of the above

17 ____________ provides diagnostic information about how and why we observe

certain effects in the marketplace, and what they mean to marketers?
(A): Marketing information
(B): Marketing data
(C): Marketing insights
(D): None of the above.

18 _________ as the systematic design, collection, analysis and reporting of data

and findings relevant to a specific market situation facing the company.
(A): Marketing Research
(B): Marketing Planning
(C): Data Collection
(D): None of the above

19 Marketing Research firms fall into _____ categories.

(A): 3
(B): 4
(C): 5
(D): 6

20 ___________-gather consumer and trade information which they sell for a fee.
(A): Customer marketing Research firm
(B): Speciality line marketing Research firm
(C): Syndicated Service Research firm
(D): None of the above

21 IMRB International is a:
(A): Syndicated Service Research firm
(B): Speciality line marketing Research firm
(C): Speciality line marketing Research firm
(D): None of the above

22 ______________design and carry on research studies for various clients based on

specific briefs.
(A): Customer Marketing Research Firm
(B): Syndicated Service Research firm
(C): Speciality line marketing Research firm
(D): None of the above

23 ________________________provide specialized research services such as developing

a research brief.
(A): Syndicated Service Research firm
(B): Customer Marketing Research Firm
(C): Speciality line marketing Research firm
(D): None of the above

24 In a marketing research process, problem should not be defined ________

(A): Too broadly
(B): Too narrow
(C): Either too broadly or too narrow
(D): None of the above
25 ______ from the decisions can be a good way of defining problems because the
purpose of research is to generate meaningful information.
(A): Working from start
(B): Working backwards
(C): a & B
(D): None of the above

26 The transaction cost of trading of financial instruments in centralized market

is classified as:
(A): flexible costs
(B): low transaction costs
(C): high transaction costs
(D): constant costs

27 In primary markets, the property of shares which made it easy to sell newly
issued security is considered as:
(A): increased liquidity
(B): decreased liquidity
(C): money flow
(D): large funds

28 The money market where debt and stocks are traded and maturity period is more
than a year is classified as:
(A): shorter term markets
(B): capital markets
(C): counter markets
(D): long-term markets

29 The type of market in which securities with less than one year maturity are
traded is classified as
(A): money market
(B): capital market
(C): transaction market
(D): global market

30 In capital markets, the major suppliers of trading instruments are:

(A): government and corporations
(B): liquid corporations
(C): instrumental corporations
(D): manufacturing corporations

31 Which one of the following is a regarded as classic venture capital?

(A): MBO finance
(B): Early stage
(C): Institutional
(D): Corporate

32 A factor affecting the growth of VC finance:

(A): Culture and environment
(B): Interest rates
(C): Easing stock market barriers
(D): Increased business banking finance

33 Business angels are an example of this:

(A): Formal Venture Capital
(B): Classic Venture Capital
(C): Corporate Venture Capital
(D): Informal Venture Capital

34 Which of the following may attract VC funding?

(A): A lifestyle company
(B): A family company
(C): A high tech company with global markets
(D): A low tech company without global markets

35 VC companies may specialise in order to reduce:

(A): Administrative costs
(B): Search costs
(C): Marketing costs
(D): Information costs

36 This stage will be completed to finalise a VC deal:

(A): Evaluation
(B): Structuring
(C): Screening
(D): Monitoring

37 This stage will be completed to complete the VC decision

(A): Evaluation
(B): Structuring
(C): Screening
(D): Monitoring

38 Which of the following areas are business angels most likely to invest in?
(A): Where the amount required is less than 20k
(B): Where the sector is were they have had previous experience
(C): Where the company wishes to grow slowly.
(D): Where the business angels knows the entrepreneur.

39 Which one of the following is a match-making agency for business angels and
entrepreneurs?
(A): LINC
(B): TECs
(C): LECs
(D): SBS

40 How do VC companies monitor their investment?

(A): Through representation on Board of Directors
(B): Through monthly accounts
(C): Through meetings with the entrepreneur
(D): Through an annual report from the entrepreneur
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