Question

Sam is planning to start a pool cleaning business from his home, but has realized that he does not have enough money in savings or credit to pay for the set-up costs and first year of operation. Which of the following would not be a good way for Sam to get the money to start his business?
a.
Talk to a bank about a business loan for the missing funds.
b.
Talk to an investor about investing their money into his business.
c.
Purchase a $3,000 compact car instead of a truck for his business.
d.
Find a business partner to share the initial expenses.

Answer 1

c. Purchasing a $3,000 compact car instead of a truck is not a way to get money — it’s a cost-cutting choice (and may not even be suitable for hauling pool equipment), whereas the other options are ways to obtain startup funds.