To Invest or not to Invest: The Start-Up Investment Decision-Making Process
This article discusses the five stages involved in securing financing for a start-up business. The first stage involves market analysis to determine the potential for development, including estimation of the addressable market, analysis of the competitive environment using tools like the Five-Forces...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Editura ASE
2023-06-01
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| Series: | Management and Economics Review |
| Subjects: | |
| Online Access: | https://www.mer.ase.ro/files/2023-2/8-2-4.pdf |
| _version_ | 1797797842016796672 |
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| author | Corina SERBAN (PATRINTAS) Cristian NEGRUTIU Andreea-Nicoleta BICHEL |
| author_facet | Corina SERBAN (PATRINTAS) Cristian NEGRUTIU Andreea-Nicoleta BICHEL |
| author_sort | Corina SERBAN (PATRINTAS) |
| collection | DOAJ |
| description | This article discusses the five stages involved in securing financing for a start-up business. The first stage involves market analysis to determine the potential for development, including estimation of the addressable market, analysis of the competitive environment using tools like the Five-Forces Model, and identification of the ideal customer and/or consumer. The second section focuses on the business model, which involves determining whether the product is technological or service-based, and conducting a product description, numerical estimation, and definition of the technological dimension. The third section outlines the growth strategy, including identifying competitive advantages and developing a roadmap with the main commercial and technical characteristics to be developed in the future. The fourth stage involves determining the amount of investment required and how the funds will be used. The evaluation of the start-up is a crucial step in this process. The article identifies two fundamental principles for evaluation, namely, that the earlier the start-up, the less sophisticated the evaluation methods, and that since start-ups are not listed on the stock exchange, evaluation is eminently subjective and a continual negotiation process. The final stage involves auditing the existing situation to determine whether the company presents legal or financial risks and whether financing can take place or not. |
| first_indexed | 2024-03-13T03:54:28Z |
| format | Article |
| id | doaj.art-0658baba31ff4e0e89ac682156ff7559 |
| institution | Directory Open Access Journal |
| issn | 2501-885X |
| language | English |
| last_indexed | 2024-03-13T03:54:28Z |
| publishDate | 2023-06-01 |
| publisher | Editura ASE |
| record_format | Article |
| series | Management and Economics Review |
| spelling | doaj.art-0658baba31ff4e0e89ac682156ff75592023-06-22T05:46:27ZengEditura ASEManagement and Economics Review2501-885X2023-06-0117017917017910.24818/mer/2023.06-04To Invest or not to Invest: The Start-Up Investment Decision-Making ProcessCorina SERBAN (PATRINTAS)0Cristian NEGRUTIU1Andreea-Nicoleta BICHEL2Bucharest University of Economic Studies, Bucharest, RomaniaBucharest University of Economic Studies, Bucharest, RomaniaBucharest University of Economic Studies, Bucharest, RomaniaThis article discusses the five stages involved in securing financing for a start-up business. The first stage involves market analysis to determine the potential for development, including estimation of the addressable market, analysis of the competitive environment using tools like the Five-Forces Model, and identification of the ideal customer and/or consumer. The second section focuses on the business model, which involves determining whether the product is technological or service-based, and conducting a product description, numerical estimation, and definition of the technological dimension. The third section outlines the growth strategy, including identifying competitive advantages and developing a roadmap with the main commercial and technical characteristics to be developed in the future. The fourth stage involves determining the amount of investment required and how the funds will be used. The evaluation of the start-up is a crucial step in this process. The article identifies two fundamental principles for evaluation, namely, that the earlier the start-up, the less sophisticated the evaluation methods, and that since start-ups are not listed on the stock exchange, evaluation is eminently subjective and a continual negotiation process. The final stage involves auditing the existing situation to determine whether the company presents legal or financial risks and whether financing can take place or not.https://www.mer.ase.ro/files/2023-2/8-2-4.pdfcompetitive advantagesfive-forces modelgrowth strategyinvestmentrisks |
| spellingShingle | Corina SERBAN (PATRINTAS) Cristian NEGRUTIU Andreea-Nicoleta BICHEL To Invest or not to Invest: The Start-Up Investment Decision-Making Process Management and Economics Review competitive advantages five-forces model growth strategy investment risks |
| title | To Invest or not to Invest: The Start-Up Investment Decision-Making Process |
| title_full | To Invest or not to Invest: The Start-Up Investment Decision-Making Process |
| title_fullStr | To Invest or not to Invest: The Start-Up Investment Decision-Making Process |
| title_full_unstemmed | To Invest or not to Invest: The Start-Up Investment Decision-Making Process |
| title_short | To Invest or not to Invest: The Start-Up Investment Decision-Making Process |
| title_sort | to invest or not to invest the start up investment decision making process |
| topic | competitive advantages five-forces model growth strategy investment risks |
| url | https://www.mer.ase.ro/files/2023-2/8-2-4.pdf |
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