Private investors who use their own money, unlike Venture Capital companies which use pools of investor moneys. Angels range from friends to professional investors. The term originated with investors in theater productions.

Business Plan

A complete, detailed description of a business, including financial statements and projections, business objectives and marketing strategies, that are almost always required by investors and lenders.

Business Structure

The legal form you use to set up your business impacts issues such as tax status and liability.

Commercial Loans

Loans made by financial institutions, usually secured by an asset or other collateral, such as accounts receivable financing (or factoring), contract financing, equipment financing (or leasing), letters of credit for import/export, purchase order financing, et al.

Company Profile

A short, concise description of a business used to introduce a company to a client, investor or other business prospect.

Corporate Structure

General Partnership - is a partnership in which the partners conduct business for the mutual benefit, share profits, losses and management decisions equally.

Joint Venture - is when two or more businesses form a new company to pursue a single business purpose for profit mutual profit.

Limited Liability Corporation - combines a partnership and the corporation having limited liability, like a corporation, but the tax and flexible management benefits of a partnership.

Limited Liability Partnership - is a form of general partnership in which at least one partner is a general partner, with full liability for partnership debts and obligations, while the limited partners have limited involvement with the management of the business and are insulated from personal liability Protection may vary from state to state.

Limited Partnership - is a partnership in which the general partner manages the partnership and is personally liable for partnership debts, whereas a limited partner does not control the business and is relieved from liability beyond the amount of his/her capital contribution.

Owner - refers to a person who has title to a property.

Corporation - separates the legal owner(s) of a business from their business and provides protection of personal assets from the liabilities of the corporation which borrows money, makes business deals, owns property and engages in other business activity.

S Corporation - (Per Internal Revenue Code Section 1361) provide corporate liability protection for shareholders with taxes calculated at the personal rate.

C Corporation - pays corporate income taxes separate from their shareholders on income after business expenses.

Sole Proprietorship - If you do not incorporate or have a partner, you are considered a sole proprietor and your business profits will be taxed as personal income.

Professional Corporation - A corporation formed by a group of people in the same profession.

Non-Profit Corporation - Though not a business per-se, incorporation as a not-profit entity with IRS 5013c approval exempts both the corporation and its contributors from taxes.

Debt-Equity

A loan which uses a percentage in the company as collateral. Repayment may be made in cash, stock or a combination.

Equity

A stake, or percentage, in a company, which may be held as shares of stock, options to buy stock or a percentage of ownership.

Executive Summary

The introduction to a Business Plan, it is generally longer and more detailed than a company profile.

Initial Public Offering (IPO)

When a privately held company makes its stock available to the public for the first time through the capital market in accordance with SEC (U.S. Securities and Exchange Commission) regulations.

Loans

Funds that are borrowed usually with interest, and paid back according to specific terms. (See Commercial Loans.)

Private Placements

Offering shares privately without being required to register with the SEC but in accordance with SEC regulations. For example under SEC Rule 505 you can sell securities to an unlimited number of accredited investors and up to 35 other purchasers, but not to the general public; sales of securities without public notice or publicity.

Seeking Capital

Businesses need capital to start, operate and grow. Some of the most standard methods of capitalization include Loans, Equity, Debt-Equity, Private Placements, Venture Capital, Angel Investors , and Initial Public Offering (IPO).

Strategic Alliances

Informal arrangements between companies to co-market and perform other mutually beneficial activities.

Strategic Partners

A partnership or other relationship between two companies that is intended to be mutually beneficial; where two companies with complementary interests come together to expand their businesses.

Template

A document template that you have loaded in Word by using the Templates and Add-Ins command on the Tools menu.

Use of Proceeds

An over view of the way a company will use and spend monies borrowed or earned; an expenditure budget.

Use of Proceeds

An over view of the way a company will use and spend monies borrowed or earned; an expenditure budget.

Venture Capital

A fund set up specifically for the purpose of investing in start-up or growth businesses.