For entrepreneurs, understanding TVM is crucial for several reasons: 1. Investment Decisions: When evaluating potential projects or investments, entrepreneurs must consider both the initial outlay and the future returns. TVM helps in comparing the value of money received in the future with money invested today. 2. Resource Allocation: Efficient allocation of resources is a cornerstone of successful entrepreneurship. TVM allows entrepreneurs to prioritize projects that offer higher returns sooner, optimizing the use of capital. 3. Risk Management: TVM can help in assessing the risk associated with long-term projects. Money expected in the distant future is less certain and more prone to risk, which TVM helps quantify. 4. Valuation of Business: When determining the value of a business, especially for startups seeking funding, TVM is used to calculate the present value of expected future cash flows.