Bootstrapping – Mindset and Ricks [WLOs: 2, 3] [CLOs: 1, 2, 3, 4, 5, 6]
Prior to beginning work on this
discussion, complete the text reading assignment and review the articles listed in Recommended Resources as well as read the article Evaluating a Company’s Capital Structure (Links to an external site.).
Your partner discovered the bootstrapping concept and wants to work with you on understanding the concepts and the risks associated with bootstrapping as a mindset. Analyze the use of bootstrapping to start a venture and evaluate the risks associated with the bootstrapping mindset. After the venture is started, evaluate two alternatives to conventional loans as a source of financing.
As you develop your response, focus on the following information (you are encouraged to go beyond the text for information):
Bootstrapping is a state of mind as well as specific techniques. Consider the risks associated with the bootstrapping mindset as you develop your response.
What are some risks associated with the financing sources you recommended?