Customer Reviews

Entrepreneurial Finance - Finance for Small Business (3rd Edition)

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Pros:
Definitions and concepts are introduced one at a time most of the time. Glossary is provided. Answers in even number problems are provided. Review and Discussion Questions are provided with no answers, but they can be easily checked in the corresponding chapters. Included in Appendix D is a case study on a donut shop of small business finance.

Cons:
Useless Excel spreadsheets that come with CD. The authors include Excel tables used in each chapters. Many times figures are HARD TYPED, not derived from formulas. Some people may want to use the spreadsheets for their own needs, but this practice diminishes the point of using a spreadsheet. Some concepts are not clearly or completely explained such as future value of an ordinary annuity, and EOQ (basically formulas in chap 8). The derivations of formulas are not provided, which let the reader merely memorize and simply plug in values in the formula without understanding the context to use and the assumptions. "Entrepreneurial" contents are scarce considering the intent of the book, which barely distinguishes itself from other typical corporate finance books. I would like to see more real life case studies such as the one in Appendix D, so that material learned throughout chapters can be demonstrated in the context and in a coherent manner. Interdependences and relations of concepts should be explicitly iterated and be shown with visual aids.

Prerequisite:
Basic algebra at junior high school level, including power, logarithm and summation. No prior knowledge of finance is assumed.

Comment:
I would look elsewhere for a basic finance book with more of application and implementation tastes. This may -not be fair to the authors' intention, but hands-on modeling with spreadsheet is a better and more sophisticated approach to me. I recommend to read any introductory finance book that explains concepts and their interdependence very well, then move on to a spreadsheet modeling book for implementation such as Financial Modeling by Benninga, Practical Management Science by Winston and Albright, Excel 2000 Formulas by Walkenbach, and Financial Models Using Simulation and Optimization by Winston.

I use this text in a course I teach and I think it is a great basic primer. In explains in simple language the subjects that entrepreneurs must have a working knowledge of and many don't. If you are just out of undergrad business school, this may be too simple - but most entrepreneurs are 30+ and have been out of school for a while. This is a great, pragmatic tool for this group.