What To Ask About Equity Finance, With Robert Jain
by Jason McDonald
In order to start a business, capital must be amassed. This can be done by way of borrowing money from others, including those that may end up claiming stakes in companies. This is where equity finance comes into the picture, and it's a fairly common business practice as well. For aspiring entrepreneurs that are looking to build funds, here are some questions that would be wise to ask. As the likes of <a href="https://www.usatoday.com/story/money/business/2015/03/02/ozy-bobby-jain-charitable-giving/24263137">Robert Jain</a> can attest, you'll have an easier time starting your business.
"What's the definition of equity finance?" This term refers to the act of raising money for business purposes, primarily through investors. It's not uncommon for investors to purchase company shares, mainly due to the fact that it gives them a stake in the companies they work for. It's not akin to securing a percentage of business ownership. Details like these are just a few that reputable names in finance, <a href="https://www.linkedin.com/in/bobjain">Bob Jain</a> included, can provide.
"Is there more than one type of equity financing?" Yes, equity financing is broken up into a number of subtypes, some more common than others. These categories include, but aren't limited to, family financing, small business investing, and royalty financing. As you might imagine, these categories differ in terms of where money is coming from. Nonetheless, it's worth researching the options at your disposal to find which one will serve you best.
"What are the benefits of equity financing?" One of the standout benefits to note is that it doesn't take a tremendous financial burden on the company. Since entrepreneurs aren't putting any of their own money in, they can apply their resources elsewhere. They also don't have to worry about repaying the money acquired through this method. These are just a few upsides to make note of.
"Are there downsides to using equity financing?" Before you decide on equity financing, there are a few caveats to be mindful of. First, it takes considerable effort to find investors. Second, you will have to share a portion of your business with investors. Third, it's possible that you may struggle to work with others. If you believe that any one of these are deal-breakers, you may want to look other options to finance your business.
For additional information about equity finance, kindly consult <a href="https://www.jainfamilyinstitute.org/team-blog/2017/4/20/robert-jain">Bobby Jain</a>.. Free reprint available from: <a href="http://www.uberarticles.com/home.php?id=2199018&p=107346">What To Ask About Equity Finance, With Robert Jain</a>.
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