Question
Reply in your own words More than 200 words plzz. of the capital raising strategies you shared here, which is most appealing to you? for
Reply in your own words More than 200 words plzz.
of the capital raising strategies you shared here, which is most appealing to you? for a small restaurant business.
. Informal investors - Informal investors include family, friends, colleagues, suppliers or private investors often called 'angels. (Advani)
2. Debt funding - This is another source of raising capital like automobile loans, mortgages. This is entering into a legal obligation to repay the amount of money borrowed. Debt funding is available from banks, non banking institutions such as asset-based lenders and brokerages. Under debt funding there are few options they are:-
A. Loans from life insurance - I will be able to borrow against the cash surrender value of my life insurance policy. It is possible to borrow up to 95 percent of the paid in value of a whole life policy.
B. Home Equity Credit or Second Mortgages - It is possible to get a home equity loan or a line of credit as i have enough equity and qualify for a home equity loan. It helps to borrow up to 80 percent for the appraised value of my home and this borrowing may offer tax advantage.
C. Government assisted loans - Government assisted small business loans are offered by federal agencies such as the Small Business Administration (SBA) , the Economic Development Administration (EDA) and the Rural Economic and Community Development as well as by state and local agencies. I will take advantage of the several loan programs in which government either directly lends or provides guarantee of repayment for other busines lenders.
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