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Financing your business: Getting loan or selling bonds

Discussion in 'Financing Your Business' started by Vinaya.Ghimire, Feb 11, 2016.

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  1. Vinaya.Ghimire

    Vinaya.Ghimire Member

    What is more appropriate for financing your business: getting loan or asking people to invest so that your solo business becomes partnership project.
  2. Corazon

    Corazon Member

    As per my experience, it is not good to rely on borrowings for additional capital to your business, much more starting up via a loan. When our computer retail business was flourishing, we had to borrow money and pay high interest until such time we noticed that our profit was only going to the interest. We could have bought a service car from those interest payments. So it is best to open up a business with ample capital, no borrowings.
  3. mooray

    mooray Member

    I would prefer to start my business with no loan whatsoever. In fact, asking people to invest in your business can back to haunt you someday. The best way is to invest with your own saved capital and when the business expends and starts making considerable profit, that is when you can invent other people to invest. But only when it has started making profit and must I say, don't forget to secure your majority shares.
    Michka.Martina likes this.
  4. T J Tutor

    T J Tutor Member

    I never recommend loans for starting a business.

    Get a plan together and find a co-founder.

    Get a plan together and take side jobs to save enough for initial startup sequences.

    Sell unnecessary or unwanted holdings to fund a startup.

    Find an online business model with an inexpensive entry requirement and build up a cash reserve for a startup.

    There are hundreds upon hundreds of selfstarter methods and models to generate enough funds to get a startup going.
  5. Vinaya.Ghimire

    Vinaya.Ghimire Member

    Sadly, I started my business with a bank loan. I spent my savings to develop the infrastructure. When the business infrastructure was set, I did not have any money to invest. I invited many people to invest, but no one was interested. Then I applied for loan. I used the money to invest in my business. I pay my EMI via the money made through sales. Since most of my income goes to bank, I don't have cash in hand. Thus I am looking for a partner.
  6. Brian D. Evans

    Brian D. Evans Member

    Loans are tough. A lot of businesses fail. And you don't want a loan over your head or your companies head. I know people that literally can't sleep if they feel they or their company "owes someone" any amount of money.

    Investments from friends and family can work well because they are usually less critical about things. But it can also hurt relationships if you lose it all.
    T J Tutor likes this.
  7. Pansy

    Pansy Member

    I am seeking for a good business plan with ROI Rates from 5% to 12% P.A for Five to Ten years period please kindly contacts me for discussion? We have Investment portfolio from $1,000,000.00 to $1,000,000,000.00 as debt / equity investment Boost.
  8. remnant

    remnant Member

    I think a partnership is better since it would rope in capital and has the potential to grow into a company more easily. Profits and losses are shared cushioning the business from external shocks. There is also hybridization of ideas. It the case of a loan, hitherto unforseeable factors would bring debt collectors and auctioneers breathing down your colour as opposed to a partnership which would mean dissolution or diversification.
    Pansy and Michka.Martina like this.
  9. dev johnson

    dev johnson Member

    For starting a business i don't recommend loans. when you are into business and need some extra cash for business expenses then you should look for loans. Most of the business owners do same thing.

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