Chapter 6 – Entrepreneurship and Small Business Management Vocabulary

Entrepreneur
Entrepreneur
Someone who takes a risk in starting a business to earn a profit.
Entrepreneurship
Entrepreneurship
The process of starting, organizing, managing, and assuming the responsibility for a business.
Venture Capital
Venture Capital
Money provided by large investors to finance new products and new businesses that have a good chance to be very profitable.
Innovation
Innovation
An invention or creation that is brand new.
Improvement
Improvement
A designed change that increases the usefulness of a product, service, or process.
Small Business
Small Business
An independent business with fewer than 500 employees.
Small Business Administration (SBA)
Small Business Administration (SBA)
A government agency that helps small business owners develop business plans and obtain financing and other support for their companies.
Business Plan
Business Plan
A written description of the business idea and how it will be carried out, including all major business activities.
Start-up financing
Start-up financing
The amount of money needed to open the business.
Short-term financing
Short-term financing
The money needed to pay for the current operating activities of a business.
Long-term financing
Long-term financing
The money needed for the main resources of a business (such as land, buildings, and equipment) that will last for many years.
Proprietorship
Proprietorship
A business owned and run by just one person.
Partnership
Partnership
A business owned and controlled by two or more people who have entered into a written agreement.
Corporation
Corporation
A separate legal entity formed by documents filed with your state. It is owned by one or more shareholders and managed by a board of directions.
Franchise
Franchise
A written contract granting permission to operate a business to sell products and services in a set way.
Partnership agreement
Partnership agreement
A written agreement among all owners detailing the rules and produces that guide ownership and operations.
Articles of incorporation
Articles of incorporation
A written legal document that defines ownership and operating procedures and conditions for the business.