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Six sources of finance for a new business venture.
- Bank lending
Borrowings from banks are an important source of finance to companies. Bank lending is still mainly short term, although medium-term lending is quite common these days.
- Leasing
A lease is an agreement between two parties, the "lessor" and the "lessee". The lessor owns a capital asset, but allows the lessee to use it. The lessee makes payments under .the terms of the lease to the lessor, for a specified period of time.
- Retained earnings
For any company, the amount of earnings retained within the business has a direct impact on the amount of dividends. Profit re-invested as retained earnings is profit that could have been paid as a dividend.
- Ordinary (equity) shares
Ordinary shares are issued to the owners of a company.
- Grants from private foundations and non-governmental organizations.
Government funding especially for youth projects.
- Personal savings,
possibly from initial employment i.e if the business venture is a sole proprietorship or partnership
marto answered the question on January 30, 2019 at 07:25
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