If you are looking for an investor for your business plan, you probably don’t think much about where the money comes from – as long as it comes! However, there are a variety of different methods of finance, and each has it’s own distinct pros and cons.
So if you are in the market for a business investor, and you aren’t sure how the various types of deal work, read on, and make an informed decision when the time comes.
Traditional Debt Finance
Traditional debt finance is the first type of investment that most business owners think of when they are looking for investors to fund their business ideas. This type of investment is your standard bank loan, and it comes with the usual monthly repayments, as well as interest.
Aside from the worry of having to pay that loan back while you’re working on starting your company, you also need to remember that often, you will need some form of collateral to secure this type of loan, and that banks around the world have tightened up their lending criteria, so it’s got a lot harder to get business finance!
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