Funding Goals

What amount of money is needed? How will the funds be used? What interest rate (lending) or return on investment (equity) is the business able and willing to pay? What risks is the business willing to take on for the funding - loss of control through equity financing or loss of the business through liquidation associated with debt financing?



 

 

Criteria

Debt

Equity

Both

Amount -Funders will have max and min amounts that they will make available




Use of funds - Different uses of funds require different kinds of money therfore different sources. Funds to purchase assets comes from debt sources. Research is usually funded by equity sources.




Costs - banks look for interest. Investors looks for return on investment.

Consequences - Failure to repay debt may result in loss of business - failure to generate return on investment may result in loss of control.

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Saturday, 21 October 2017
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