Chapter 11 Business Organizations November 10th 2014 11 0 Forms of Business Organizations Introduction Definitions existence from its owners Corporation Legal entity chartered by the state with a separate and distinct Business Commercial enterprise organized for profit of its owners and involving the provision of goods or services to a customer Creditors Persons or entities to whom money is owed Franchisees Persons or entities granted a franchise to market or sell the franchisor s goods or services usually under a franchise agreement Limited Liability Investment where the investor s maximum possible losses is the amount invested Forms of Business Organization 1 Sole Proprietorship 2 General Partnership 3 Limited Partnership 4 C Corporation 5 S Corporation 6 Limited Liability Company Venture Capital Firms Combine funds from institutional investors and angel investors to identify promising start ups and fund them in a private placement o Angel Investors Affluent individuals who provide capital to start up and early stage businesses o Private Placement Nonpublic offering in which a business sells securities to a few chosen and qualified investors to raise capital Seek an exit strategy by offering sale of the business to the public in an initial public offering o Initial Public Offering IPO First time a corporation sells its shares to members of the public
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