external financing Flashcards
(13 cards)
What is a common reason small business owners approach family and friends for finance?
To invest in or lend money to a business.
What do banks provide to businesses?
Loans such as small business loans, overdrafts, and mortgages.
What is peer-to-peer funding?
Individuals pool their savings to lend to businesses through schemes like Funding Circle.
Who are business angels?
Individuals who invest in start-ups or expanding businesses.
What is crowdfunding?
Finance from a large number of small investors via online platforms like Kickstarter.
How can other businesses provide finance?
Through joint ventures or by buying shares for investment or takeover.
What is a loan?
A sum of money borrowed and repaid with interest over a period.
What is an overdraft?
Allows a business to spend more than it has in its account, up to a limit.
What is share capital?
Money raised from selling shares in a limited company.
What is venture capital?
Investment from investors in small/medium businesses with growth potential.
What is leasing?
Using assets (like equipment) for regular payments without ownership.
What is trade credit?
Buying stock or materials and paying later (30–90 days).
What are grants?
Funds provided by government/trusts with specific conditions.
