Funding a New Biotechnology Firm Assignment Example | Topics and Well Written Essays - 1000 words

Funding a New Biotechnology Firm - Assignment Example Bragg notes that this may be advantageous as the entrepreneurs are able to maintain ownership of the enterprise. He contends that tax deduction is another merit for using this approach. However, the demerit includes repayment of the principal amount accompanied by interest. The gain is that the entrepreneurs are able to acquire additional funds and develop from start up. Angel investors are yet another way within which one can acquire financing. This according to Hill & Power (2002) is acquiring venture capital from individual investors. It is more appropriate for start up business that has yet to get revenues or sales. The individual investors may be willing to invest if conditions of relinquishing control are accepted. They also may want to invest if they have prior knowledge of success in that particular field, which in these regard is the biotechnology enterprise. In his article, DeBaise (2009) observes that angel investors are wealthy individuals who may want ownership in the en terprise. In 2007 angel investors invested around $26 billion, which amounts to around 57,120 ventures that breaks down to $450,000. This is according to the research carried out by venture research at the University of New Hampshire in the year 2007. This, it contends, leads to a powerful resource for new entrepreneurs (DeBaise 2009). Self funding is another way through which the entrepreneurs can acquire funds. This is where they can decide to raise the required amount through contributions from own funds (Megginson 2004). Examples of ventures that started in this way include Dell Company that had its founder Michael Dell start with his own savings. To a large extent, this is very encouraging as the advantage is that the entrepreneurs are able to maintain control of the... This essay stresses that the decision to start any business is exciting and encouraging to the growth of the economy of any country. However, many entrepreneurs blow up their dreams of starting up businesses due to lack of finances to develop their ideas. It is with this view that the above paper has offered the various ways the entrepreneurs can solicit for funds. The prospects of acquiring funds from any of the proposed funds strategy are exciting but what is required is caution in whatever choice one takes. Recommending any particular funds strategy may deem inconsiderate but making a preference is rather fair so as the entrepreneurs can be able to contemplate what they want. This is to be backed by evidence that indeed that particular funding strategy has been successful. Angel investors are yet another way within which one can acquire financing. This paper makes a conclusion that the United States is ranked top as a biotechnology leader with many investors in that particular venture and the highest funding strategy at an 80 percent is venture capital. This stands out then as the most appropriate funding strategy due to the nature of venture. Biotechnology venture is known to be a high risk venture thus requiring alot of capital and investors who have the knowledge of the market. Venture capital in this perspective appears to be the solution for the entrepreneurs.