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stage – этап

preferable – предпочтительный

to gather information – собирать информацию to start up – начинать

to complete – завершить, дополнить, закончить

to lend money – давать деньги в долг, одалживать деньги to borrow money – занимать деньги

to collect interest – взимать процент

to tend to – иметь тенденцию, склонность к чему-либо to raise money – собирать деньги

to fail – потерпеть неудачу, провалить(-ся) to depend on – зависеть от

to consider – обсуждать, обдумывать, полагать, считать, соображать, рассматривать

Ex. 2. Read and translate the dialogue from English into Russian. Mind the words and word combinations underlined in it.

Good News

Lena: Hello, Oleg! I haven’t seen you for ages!

Oleg: Hi, Lena! When have you arrived from Portland?

Lena: I was there a month ago. I have just come from New York. The USA is, certainly, a country of great opportunities, but any up-and-coming person can reach the heights of wealth and power here, in the Russian Far East, as well.

Oleg: I see you are loaded with ideas. Any project?

Lena: You are quite right. I’m cherishing the idea of doing something incredible! And I need your advice.

Oleg: I’m always at your service!

Lena: That’s about the Russian-American student joint-venture we were going to set up. I have discussed our proposals with the Americans.

Oleg: And that means…

Lena: That means we are to complete the draft budget, gather more information about possible directions of our business, and send all that to New York. If everything is OK, they will finance the project.

Oleg: Good news! This project could be a promising step for starting up.

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Ex. 3. Match the columns and remember the word combinations from the above text.

1.	Up-and-coming businessman	a.	Завершить смету
2.	To be at smb’s service	b.	Я не видел тебя сто лет!
3.	A promising step for starting up	c.	Лелеять идею (мысль) сделать
			что-либо
4.	To be loaded with ideas	d.	Собирать информацию
5.	To cherish the idea of doing smth	e.	Перспективный бизнесмен
6.	To reach the heights of wealth and f.		Быть перегруженным идеями
	power		(мыслями)
7.	I haven’t seen you for ages!	g.	Многообещающий шаг для начала
8.	To complete the draft budget	h.	Достичь высот богатства и
			счастья
9.	To gather information	j.	Быть в чьём-либо распоряжении

Ex. 4. Answer the questions.

1.What legal and structural framework of business are Lena and Oleg going to set up?

2.What country do they plan to cooperate with?

3.Was Lena in the US for pleasure or on business?

4.Why are they to complete the draft budget?

5.Is financing of great importance for a start-up company?

6.What are the primary expenses of the start-up firm?

7.What are the current expenses of any firm?

8.Is it possible for a student to set up and run his own business?

9.Can the students’ business be successful?

10.Where can a student get money to develop his company?

Ex. 5. Build your vocabulary. Put the words under the following headings:

-Current expenses,

-Organization expenses,

-Extra expenses,

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-Manufacturing overheads.

Forms of the registration documents, equipment, office, telephone, gifts, sponsor work, advertising, calculator, design works, company’s seal and forms, banker’s commissions, license, office furniture, vehicles, souvenirs, registration dues, personal computer, salaries, mail, transportation, banquet, authorized capital, office accessories, welfare costs, marketing research, raw materials, entertainments, photocopier, notary verification of documents, office paper, business lunch, industrial modernization, repair, printer, works on the equipment erection.

Ex. 6. Sum up the above material and speak about the following topics.

1.Primary expenses of the start-up company.

2.Other expenses of the newborn firm.

3.First steps problems of the new business.

Ex. 7. Read and translate the text from English into Russian.

How to Start up and Develop a Business

One of the common problems in business is not having enough money. Companies, which are starting to operate on the market, can face this problem and fail just at the beginning. It is rather useful to spend some time working out cash needs and monitoring cash flow. Talking to experienced accountants and successful businessmen is also effective. Otherwise, it is easy to underestimate the amount of money, which is available for starting up a business.

The following essential questions should be considered in the early stages of the company:

How much money will I need?

Which expenses will I have to come across?

What are my profit expectations?

What time will I need to make my business run profitable?

Where will I get money for that start-up period?

Having appreciated all financial difficulties a businessman can weigh up possible expenses of the firm.

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Firstly, they are general operating expenses, which include renting premises, furniture, office accessories and paper, office automation equipment like a photocopier, a printer, a fax, a personal computer, public utilities and other services, vehicles, and so on. Secondly, one considers payments of taxes, salaries and other charges (e.g. bank charges or insurance ones) to be fixed expenses. The next item is expense going for acquisition of equipment, raw materials, packaging or others. Sometimes the total amount on this item is rather large. Any enterprise needs advertising for its product or service to promote. It is also indispensable to study and analyze the market, where that product or service is to be sold. Certainly, a businessman should take into account the cost of advertising as well. It includes various letters of information and advertising, booklets, leaflets, billboards, announcements, on-line and TV promotion, actions and campaigns. Some companies often spend money to create their image.

It is extremely important to make a business run well, and simultaneously, try to arrange resources as sensibly as it’s possible. Look before you leap. Think over your employment policy. Sometimes the experienced and skilled employee is better than two or three ordinary specialists. Find suitable workers, not those of your relatives, friends, classmates or your friends’ relatives. Employ qualified workers; their nationalities, appearance, age or gender should not be a decisive factor when recruiting personnel.

Another problem touches upon services or goods you are going to provide.

Suppliers, equipments, quantities of stock, warehouses, means of products’ distribution, location of the business, and other essential questions are to be considered in the early stages of doing business. Here a problem of raising finance emerges.

Where could a businessman go to get money? There are several ways of borrowing or raising money. They are some:

Parents or members of his family

A friend or colleague

A bank

A loan shark

A credit card company

Private savings

Different governmental, public or charity foundations or programs supporting the development of small business

Another source.

The ways of raising finance depend on the type of the business, its stage of development and the revenue flows, coming from business.

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Raising money either through debt or equity is a common way among entrepreneurs. When raising funds through debt they go to the bank and get a bank loan. There are secured or unsecured loans. If raising money through equity, businessmen go to private investors, venture capitalists or do it through a public offering on the stock market.

But in a start-up situation it is unlikely to get a bank loan, as banks tend to be riskaverse and reluctant to lend. In this case, private investors and equity are more preferable. Sometimes a business owner goes to a loan shark that can lead to damages of some kind, for example, loss of property. That is because a loan shark lends money and collects high interest, which is connected with great risks.

Parallel to this, entrepreneurs can get money from special government-funded programs supporting and encouraging young businessmen. In Russia, such establishments are increasingly becoming very popular.

But for a growing company with a strong cash flow, using debt is more recommended than the ways of raising finance mentioned above, though it can be more expensive because of the interest to be paid up to the bank or other source, who gave the required amount.

Ex. 8. Fill in the gaps with the English equivalents to the words in the brackets. Translate the sentences from English into Russian.

1.A businessman should weigh up all ______ (возможные расходы) of his company.

2.______ (Общие расходы) of the firm include expenses for premises, furniture, office automation equipment, services and office accessories.

3.Payments of taxes, salaries, banker’s commissions, insurance charges are

______ (постоянные расходы) of the company.

4.Expenses pertaining to children summer camps organization refer to ______

(социально-культурным расходам).

5.Acquisition of machines, raw materials and packaging are considered to be

______ (производственными расходами).

6.______ (Расходы на рекламу) are indispensable for the company’s goods or services to promote on the market.

7.An entrepreneur should take into account each ______ (статью расходов) in order not to underestimate the amount of money, which is required for starting up a business.

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8.Expenses going for notary verification of the documents, opening of the account, obtaining licenses are called ______ (первичными расходами).

9.Among ______ (организационных расходов) there is payment of registration dues.

10.______ (Дополнительные расходы) are also of some importance as they include the ones connected with the stay of partners or suppliers.

11.A businessman should consider the difference between _____ (расходами) and _____ (доходами).

12.Some kinds of economic activities are allowed to be done without _____

(лицензии).

Ex. 9. Find the English equivalents to the Russian word combinations.

Распространённая проблема, поддерживать малый бизнес, оплата налогов, рекламный щит, работать на рынке, распределять ресурсы, возможные расходы, решающий фактор, банковские выплаты, предоставлять услуги, потерпеть неудачу в самом начале, предприниматель, приобретение оборудования, контроль за потоком доходов, объявление, занимать деньги, офисные принадлежности, сбор средств, обеспеченный кредит, источник, оценить трудности, реклама на ТВ и Интернет, недооценивать сумму денег, ростовщик, оргтехника, принимать во внимание, поправить дело, поставщики, благотворительный фонд, заём.

Ex. 10. Find the Russian equivalents to the English words or word combinations.

To face a problem, renting premises, total amount, insurance charges, to analyse market, profit expectations, cost of advertising, to lend money, to work out cash needs, to create one’s image, item of expense, letter of information, public utilities, employment policy, quantities of stocks, financial difficulties, recruiting personnel, first stages of business, to run business, means of distribution, to emerge, to support small business, bank loan, to collect interest, loss of property, private investor, in this case.

Ex. 11. Match the following expressions with the correct definitions given below:

a bank

a loan shark

a credit card company private savings

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a private investor

a government-funded program

1.A special governmental foundation or scheme, which supports entrepreneurship and encourages young businessmen.

2.A credit institution, which grants through its equity.

3.Person’s money saved up for future.

4.An establishment for keeping money and valuables safety, the money being paid out on the customer’s order.

5.A person or a private establishment, who employs money for profit or puts money in a business.

6.A person who lends money at interest.

Ex. 12. Choose the correct word to complete each sentence. Use the above exercise or a dictionary to help you.

1.My friend took out a _____ to extend the business. (debt / credit / loan)

2.Thanks to a governmental program _____ this new company was able to acquire equipment. (support / subsidy / contribution)

3.The _____ rate on the loan was 10 percent (charge / interest / fee)

4.Our firm has spent a (an) _____ of 50.000 rubles to finance that four-month advertising campaign. (investment / cost / amount)

5.Venture capital is money a company _____ to start up a business. (gives / lends / borrows)

6.We plan to raise money from _____ to extend the plant. (investors / employees / co-founders).

7.I have to pay the loan back over four years. The first _____ is due in February. (installment / part / amount)

8.Private individuals take a _____ when lend money from loan sharks. (share / risk / stock)

9._____ can be more expensive than equity. (debts / loans / budget)

10.Goods or services provided by any company demand expenses for _____

(salaries / advertising / commissions).

11.A credit company grants businessmen through its _____. (credit / income / equity)

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Ex. 13. Sum up what you have learnt from the above exercises and choose the correct equivalent to the following words and word combinations:

equity, human capital, risk capital, authorized capital, share capital, venture capital, working capital, invested capital, foreign capital, long-term capital, original capital, private capital.

рисковый капитал, акционерный капитал, долгосрочный капитал, частный капитал, капитал компании, состоящий из разницы между активами и текущими обязательствами, уставный капитал, венчурный капитал, оборотный капитал, инвестированный капитал, первоначальный капитал, человеческий капитал, иностранный капитал.

Ex. 14. Look through the text and answer the questions. Give the extended answers.

1.Why should a businessman consider thoroughly the amount of all expenses before starting up his company?

2.What measures are to be taken in order not to underestimate the required money?

3.Do primary expenses of a new company include organizational payments?

4.Where can an entrepreneur go to raise finance for a start-up period?

5.What expenses will a businessman come across after the company’s registration?

6.Is it necessary to hire a lot of employees at the beginning of the company’s work?

7.Why is it indispensable to spend money for the company’s promotion?

8.What does a usual advertising campaign consist of?

9.What does the proverb “Look before you leap” mean for a start-up entrepreneur?

10.Where can a start-up-private individual go for raising money?

11.Why do banks tend to be risk-averse to lend?

12.Which companies can get a bank loan?

13.Are there any funds supporting young businessmen?

14.A private individual takes a risk, when he borrows money from a loan shark, doesn’t he?

Ex. 15. Prove the statements.

1.Entrepreneurs who start their business face the difficulties in law, taxation and raising finance.