Quizizz 1 | Revision Weeks 1-6: Chapters 1, 2, 3 and 5.

In the Discounted Cash Flow valuation model, most of a venture's value typically comes from the terminal value because:

• start-ups start making profits only after several years

• the discount rate makes early stage revenue less relevant

• start-ups keep incurring losses for several years

• None of the above

Cash flow is defined using projections from the following accounts:

• income statement only

• income statement and balance sheet

• balance sheet only

• None of the above

Start-ups often lease or rent equipment rather than purchasing it because:

• It allows to use brand new equipment

• It reduces fixed costs

• It is encouraged by investors

• None of the above

What is the most important step of the FIRE framework?

• FIT because without matching there is no investment

• The four steps are equally important

• EXIT because it is here that any value creation is realized

• None of the above

What is an important behavioral bias that may make financial projections unconvincing?

• Self-interest

• Optimism

• Selective recall

• Selfishness

The bottom-up approach to financial projection reflects a:

• supply-side logic anchored on the venture's ability to produce and sell

• a demand-side logic anchored on the potential size of the market

• a supply-side logic anchored on the entrepreneur's own set goals

• None of the above

The choice of comparable companies in the methods of comparables can be difficult because:

• a company with the same business model as the focal company needs to be found

• companies within a similar industry need to be found

• companies with a comparable capital structure need to be found

• None of the above

In the Venture Evaluation Matrix, the scale criterion measures the venture's attractiveness in terms of:

• Potential market size

• Initial funding

• Initial employee count

• None of the above

In the Venture Evaluation Matrix, the Solution cell looks into:

• Comparing alternative solutions to the customer's need

• The customer's willingness to pay

• The solution to the entrepreneur's financing problems

• None of the above

How can we properly denote the dynamics of start-ups?

• Fast and steady

• Up or out

• Back and forth

• Fast and go