Business funds are the fundamental part to fuel up ambitious projects and companies’ growth. It can also be termed as entrepreneur ecosystem that promotes visionary ideas, based on practising money to make more money. To make it more simple, such business investments are basically long-term commitments to promise capital growth and regular income with the principle objectives. However, different conceptualize investments are involved to raise business or keep them afloat in the market. Learn the categories of investors looking for entrepreneurs, and understand the various kinds of investment policies.
Such investments always stands as a ‘secure’ measure because of the debt investment against the assets within the company. If equity investment has been compared to debt investment, the former always holds more challenging than the later. The contributory body who can provide the money as debt investors, are:
- Property loan: For making the big investment, there is a mortgage specialized facility to avail the loan by raising the necessary amount by mortgaging your property to the lender or bank.
- Asset-based lenders: As per the asset finance, it is been practised to purchase fixed assets like plant, vehicles, office-based machinery and equipment to prevent the direct company’s cash flow. The terms also depends on the assets of the company.
- Bank: Banks is a highly approachable option for asking investment, thus, bank overdraft may vary from a thousand pounds approx to hundreds of thousands that is known to overcome the short-term cash flow issues. Be aware of the interest rate as they are much higher than usual.
- Invoice discounters: Sometimes, there are cash-flow issues due to “delayed or absconding invoice payment”, and so to manage those critical hours, the ready-capital is pertinent subject to acquire for business survival. Hence, the invoice discounters provide one part of the invoice amount as an advance amount to keep the company afloat.
These investments are developed in exchange for ‘equity’ or part-ownership of the recipient business company. While debt investment is termed as a loan, the equity is called to be the combinational form of both types. The possible investors who can provide the fund are as follows:
- Business angels: there are investors looking for entrepreneurs and perceives dynamic proposal to invest. The angel business investors are wealthy enough to fund your idea, and uplift the status of the company. There is also 3 more reason that motivates the angel investor to support your idea, and they are backing the right business idea to practice more money, appeals the sense of exploration, and to seek a purpose to support a great idea and pull up an SME-business to the industry.
- Public listing: This is mainly for the big companies who sell their share to the people to get more successful.
- Friends, family or any associate: There are several funding options, if your family is rich or your relatives are keen enough to strengthen your business idea. For ensuring fund, they are the best option available to meet the budget.
- Venture capital trusts: Developed by the financial institution, the VCTs are the money hub to finance specific investment in stocks and shares of the small companies.
- Venture capitalists: As you know there are loads of reasons for an angel investor to fund, there are venture capitalists who are the business companies that just focus on making money in different sectors by investing to support the big business idea.
As an entrepreneur, you must explore all these dimensions of investors to get the right type of investment option for your dream venture. If you are looking for investors for business, and is very selective with your ongoing search for a potential investor, note this all-in-one funds idea as your one-stop solution.