Question 1

How much equity is commonly set aside for employee options?

Accepted Answer

A) 15-20% 
B) 20-25% 
C) 25-30% 
D) 35-40% 
E) 45-50% 
A) 15-20% 
B) 20-25% 
C) 25-30% 
D) 35-40% 
E) 45-50%

Question 2

Free resources are poor substitutes for a qualified lawyer.

Accepted Answer

A) True 
 B)False

Question 3

What are the disadvantages of distributing founder shares equally among all co-founders?

Accepted Answer

A) The lack of a primary shareholder slows down the decision making process 
B) CEO may be doing as much work as CEOs of comparable companies, but have less potential upside 
C) Such distribution makes unwanted acquisitions easy 
D) A and B 
E) A and C 
A) The lack of a primary shareholder slows down the decision making process 
B) CEO may be doing as much work as CEOs of comparable companies, but have less potential upside 
C) Such distribution makes unwanted acquisitions easy 
D) A and B 
E) A and C

Question 4

According to Inc.500, what percent of entrepreneurs start businesses with their friends or family members?

Accepted Answer

A) Less than 5% 
B) About 10% 
C) About 20% 
D) Approximately 40% 
E) More than 65% 
A) Less than 5% 
B) About 10% 
C) About 20% 
D) Approximately 40% 
E) More than 65%

Question 5

According to the chapter, which of the following is not an acceptable means of maintaining an entrepreneurs' personal cash flow?

Accepted Answer

A) Working full-time and devoting time to the new venture 
B) Working part-time and devoting time to the new venture 
C) Living off personal savings 
D) Living for his/her spouses' income 
E) All of the above are acceptable 
A) Working full-time and devoting time to the new venture 
B) Working part-time and devoting time to the new venture 
C) Living off personal savings 
D) Living for his/her spouses' income 
E) All of the above are acceptable

Question 6

Give examples of compensations used to make your start-up attractive for valuable team members.

Accepted Answer

a.Founder Shares
b.O

Question 7

Options give the holder the right to:

Accepted Answer

A) Increase the number of the company shares he is allowed to purchase 
B) Buy a share in the company at a below-market rate 
C) Secure a salary increase on a regular basis 
D) Sell his stocks on the open market for more than the prevailing market price 
E) Demand a refund on his contribution to company's equity 
A) Increase the number of the company shares he is allowed to purchase 
B) Buy a share in the company at a below-market rate 
C) Secure a salary increase on a regular basis 
D) Sell his stocks on the open market for more than the prevailing market price 
E) Demand a refund on his contribution to company's equity

Question 8

If you decide to start a venture, you should notify your current employer as soon as possible.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following should the founder of the venture do first when deciding whether or not to be the CEO of his company?

Accepted Answer

A) Ask for his/her friends opinion 
B) Take at least three personality tests 
C) Review his/her resume 
D) Work as a hired manager for at least 4 years 
E) Consult with his/her team members 
A) Ask for his/her friends opinion 
B) Take at least three personality tests 
C) Review his/her resume 
D) Work as a hired manager for at least 4 years 
E) Consult with his/her team members

Question 10

Founder shares should be distributed equally between all founders.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following personality traits best predicts entrepreneurial success?

Accepted Answer

A) Analytical 
B) Driver 
C) Expressive 
D) Amiable 
E) None of the above 
A) Analytical 
B) Driver 
C) Expressive 
D) Amiable 
E) None of the above

Question 12

Explain why solo entrepreneurs are generally less successful than team players.

Accepted Answer

a.A team is able to do more than the ent

Question 13

The size of your organization is inversely correlated to the amount of revenue your business can derive

Accepted Answer

A) True 
 B)False

Question 14

In the early years, it is critical for firms to focus on revenue-generating employees, instead of support staff.

Accepted Answer

A) True 
 B)False

Question 15

What does the movie, Startup.com, demonstrate?

Accepted Answer

A) How outside financing contributes to equity 
B) How expensive lawyers can be 
C) How working together can affect the relationship of two lifelong friends 
D) How much the government is willing to help young entrepreneurs 
E) None of the above 
A) How outside financing contributes to equity 
B) How expensive lawyers can be 
C) How working together can affect the relationship of two lifelong friends 
D) How much the government is willing to help young entrepreneurs 
E) None of the above

Question 16

What opportunities can a young company offer its potential team members?

Accepted Answer

A) Growth into higher management positions 
B) Above average market salaries 
C) More attractive social benefits packages 
D) Secure and stable jobs 
E) All of the above 
A) Growth into higher management positions 
B) Above average market salaries 
C) More attractive social benefits packages 
D) Secure and stable jobs 
E) All of the above

Question 17

It often takes four months or more to identify and hire key employees.

Accepted Answer

A) True 
 B)False

Question 18

Which factor should you consider when choosing a lawyer:

Accepted Answer

A) Size of the firm 
B) Billing rates 
C) A lawyer that has a deep knowledge of the industry 
D) If you get along 
E) All of the above 
A) Size of the firm 
B) Billing rates 
C) A lawyer that has a deep knowledge of the industry 
D) If you get along 
E) All of the above

Question 19

What is the minimum expected level of lawyers' fees?

Accepted Answer

A) $50/hour 
B) $100/hour 
C) $150/hour 
D) $200/hour 
E) $250/hour 
A) $50/hour 
B) $100/hour 
C) $150/hour 
D) $200/hour 
E) $250/hour

Question 20

You are least likely to resolve an interpersonal conflict in your team by:

Accepted Answer

A) Firing one of the parties 
B) Hiring an outside expert who is perceived as a neutral party 
C) Explaining to the parties involved that their arguments reduce the team's efficiency 
D) Mediating between the parties 
E) Transferring one of the parties to another team 
A) Firing one of the parties 
B) Hiring an outside expert who is perceived as a neutral party 
C) Explaining to the parties involved that their arguments reduce the team's efficiency 
D) Mediating between the parties 
E) Transferring one of the parties to another team

How much equity is commonly set aside for employee options?

Free resources are poor substitutes for a qualified lawyer.

What are the disadvantages of distributing founder shares equally among all co-founders?

According to Inc.500, what percent of entrepreneurs start businesses with their friends or family members?

According to the chapter, which of the following is not an acceptable means of maintaining an entrepreneurs' personal cash flow?

Give examples of compensations used to make your start-up attractive for valuable team members.

Options give the holder the right to:

If you decide to start a venture, you should notify your current employer as soon as possible.

Which of the following should the founder of the venture do first when deciding whether or not to be the CEO of his company?

Founder shares should be distributed equally between all founders.

Which of the following personality traits best predicts entrepreneurial success?

Explain why solo entrepreneurs are generally less successful than team players.

The size of your organization is inversely correlated to the amount of revenue your business can derive

In the early years, it is critical for firms to focus on revenue-generating employees, instead of support staff.

What does the movie, Startup.com, demonstrate?

What opportunities can a young company offer its potential team members?

It often takes four months or more to identify and hire key employees.

Which factor should you consider when choosing a lawyer:

What is the minimum expected level of lawyers' fees?

You are least likely to resolve an interpersonal conflict in your team by:

The Power of Entrepreneurship

The Entrepreneurial Process

Opportunity Recognition, Shaping, and Reshaping

Understanding Your Business Model and Developing Your Strategy

Entrepreneurial Marketing

The Business Planning Process

Building Your Pro Forma Financial Statements

Facing Entrepreneurial Ventures Worldwide

Raising Money for Starting and Growing Businesses

Debt and Other Forms of Financing

Legal and Tax Issues, Including Intellectual Property

Entrepreneurial Growth

Social Entrepreneurship: an Overview

Filters

Exam 6: Building the Founding Team

How much equity is commonly set aside for employee options?

Free resources are poor substitutes for a qualified lawyer.

What are the disadvantages of distributing founder shares equally among all co-founders?

According to Inc.500, what percent of entrepreneurs start businesses with their friends or family members?

According to the chapter, which of the following is not an acceptable means of maintaining an entrepreneurs' personal cash flow?

Give examples of compensations used to make your start-up attractive for valuable team members.

Options give the holder the right to:

If you decide to start a venture, you should notify your current employer as soon as possible.

Which of the following should the founder of the venture do first when deciding whether or not to be the CEO of his company?

Founder shares should be distributed equally between all founders.

Which of the following personality traits best predicts entrepreneurial success?

Explain why solo entrepreneurs are generally less successful than team players.

The size of your organization is inversely correlated to the amount of revenue your business can derive

In the early years, it is critical for firms to focus on revenue-generating employees, instead of support staff.

What does the movie, Startup.com, demonstrate?

What opportunities can a young company offer its potential team members?

It often takes four months or more to identify and hire key employees.

Which factor should you consider when choosing a lawyer:

What is the minimum expected level of lawyers' fees?

You are least likely to resolve an interpersonal conflict in your team by:

The Power of Entrepreneurship

The Entrepreneurial Process

Opportunity Recognition, Shaping, and Reshaping

Understanding Your Business Model and Developing Your Strategy

Entrepreneurial Marketing

The Business Planning Process

Building Your Pro Forma Financial Statements

Facing Entrepreneurial Ventures Worldwide

Raising Money for Starting and Growing Businesses

Debt and Other Forms of Financing

Legal and Tax Issues, Including Intellectual Property

Entrepreneurial Growth

Social Entrepreneurship: an Overview

Filters