The document discusses different types of business capital and financing options for small businesses. It defines equity capital as financing obtained through the sale of stock, while debt capital involves borrowing money that must be repaid. Sources of equity capital mentioned include individual angel investors, corporate venture capital firms, and venture capital companies. Federal loan programs aimed at small businesses that are outlined include those from the Economic Development Administration (EDA), Department of Housing and Urban Development (HUD), US Department of Agriculture (USDA), Small Business Innovation Research (SBIR) program, and Small Business Technology Transfer (STTR) program. The document also defines three types of capital that entrepreneurs need - fixed capital for permanent assets, working capital for short-term operations,

1. CHAPTER 13 DISCUSSION QUESTIONS
1) Explain the difference & the advantages/disadvantages of
equity capital & debt capital.
2) Discuss the following sources of equity capital:
A) Angels
B) Corporate Venture Capital
C) Venture Capital Companies
3) Explain the following federal loan programs aimed at small
businesses:
A) EDA
B) HUD
C) USDA
D) SBIR
E) STTR

2. CAPITAL
”ANY FORM OF WEALTH EMPLOYED TO PRODUCE MORE
WEALTH”
-3 MAIN FORMS
1) CASH
2) INVENTORY
3) EQUIPMENT

3. ENTREPRENEURS NEED 3 DIFFERENT TYPES OF CAPITAL
1) FIXED CAPITAL
2) WORKING CAPITAL
3) GROWTH CAPITAL

4. 1) FIXED CAPITAL
”CAPITAL NEEDED TO PURCHASE A COMPANY’S
PERMANENT OR FIXED ASSETS”
-MAIN TYPES OF PERMANENT/FIXED ASSETS:
1) LAND
2) BUILDINGS
3) EQUIPMENT
-MONEY INVESTED IN FIXED ASSETS TENDS TO BE FROZEN
BECAUSE IT CANNOT BE USED FOR ANY OTHER PURPOSE

5. 2) WORKING CAPITAL
”CAPITAL NEEDED TO SUPPORT A COMPANY’S SHORT-
TERM OPERATIONS”
-CURRENT ASSETS MINUS CURRENT LIABILITIES
-WORKING CAPITAL IS NORMALLY USED TO:
1) BUY INVENTORY
2) PAY BILLS
3) FINANCE CREDIT SALES
4) PAY WAGES & SALARIES
5) TAKE CARE OF UNEXPECTED EMERGENCIES

6. 3) GROWTH CAPITAL
”CAPITAL NEEDED TO FINANCE A COMPANY’S GROWTH
OR EXPANSION IN A NEW DIRECTION”
-GROWTH CAPITAL FINANCES:
1) EXPANSION OR PURCHASING NEW BUILDINGS
2) HIRING ADDITIONAL WORK FORCE
3) INCREASING INVENTORY

7. 3) GROWTH CAPITAL
”CAPITAL NEEDED TO FINANCE A COMPANY’S GROWTH
OR EXPANSION IN A NEW DIRECTION”
-GROWTH CAPITAL FINANCES:
1) EXPANSION OR PURCHASING NEW BUILDINGS
2) HIRING ADDITIONAL WORK FORCE
3) INCREASING INVENTORY