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 Robert Jain can attest, you'll have an easier time starting your business.
"What, exactly, does equity finance entail?" If you're unfamiliar with the term, equity finance refers to the raising of money through investors. The reason why investors put their money into businesses, according to such names as Bob Jain, is to make back what they put in and then some. One can make the argument that this makes the investors in question partial owners. This is just a brief overview, but it should give you a general understanding of what equity finance is about.
"What are the categories of equity financing?" As you read up on this topic, you'll learn that equity finance is a relatively diverse topic. It can be broken up into different categories, some more common than others. Angel investors, for example, are affluent individuals that are looking for high returns. Other categories include venture capital and family financing. It's important to research this topic so that you know what, exactly, you'd like to put your money into.
"What are the upsides that equity financing offers?" When it comes to the upsides of equity financing, the lessened financial burden can't be denied. Since money is coming from third-party lenders, entrepreneurs won't have to use any more of their resources than what's needed. This is just one benefit, to be sure, but it will provide considerable peace of mind to those that are looking to start their own business ventures.
"What are the drawbacks of equity financing?" When it comes to downsides, it's worth noting that the act of finding investors can be difficult. This is especially true if you're new to business ownership, have few contacts, or are looking to provide a niche product or service. Additionally, your share in your company will be smaller if you have third-party investors working with you. Simply put, you should know the risks of equity financing.
"What, exactly, does equity finance entail?" If you're unfamiliar with the term, equity finance refers to the raising of money through investors. The reason why investors put their money into businesses, according to such names as Bob Jain, is to make back what they put in and then some. One can make the argument that this makes the investors in question partial owners. This is just a brief overview, but it should give you a general understanding of what equity finance is about.
"What are the categories of equity financing?" As you read up on this topic, you'll learn that equity finance is a relatively diverse topic. It can be broken up into different categories, some more common than others. Angel investors, for example, are affluent individuals that are looking for high returns. Other categories include venture capital and family financing. It's important to research this topic so that you know what, exactly, you'd like to put your money into.
"What are the upsides that equity financing offers?" When it comes to the upsides of equity financing, the lessened financial burden can't be denied. Since money is coming from third-party lenders, entrepreneurs won't have to use any more of their resources than what's needed. This is just one benefit, to be sure, but it will provide considerable peace of mind to those that are looking to start their own business ventures.
"What are the drawbacks of equity financing?" When it comes to downsides, it's worth noting that the act of finding investors can be difficult. This is especially true if you're new to business ownership, have few contacts, or are looking to provide a niche product or service. Additionally, your share in your company will be smaller if you have third-party investors working with you. Simply put, you should know the risks of equity financing.
About the Author:
For more insight about equity finance, kindly contact Bobby Jain.. Also published at Robert Jain: Important Questions To Ask Regarding Equity Finance.