Funding For Business Start Up

Many businesspeople are looking for opportunities for beginners. TokeBusiness will discuss various types of business funding alternatives.

Funding For Business Start Up

2 Type of Business Funding

Readers' friends, try to mention the type of business funding you know! Please write your comments at the bottom of this article. Maybe some say personal savings, bank loans and so forth. To make things easier, this time Finansialku.com will create a mapping:

Indeed there are two types of business funding, namely: funding from own money and other people's money (other people money). Let's discuss one by one the types.

Funding Business with Own Money

The first business funding is to use your own money. That means you have to spend money from your own pocket (savings, deposits, cash). For example you and one friend, each must spend initial capital of  3.61 USD to start a business, then the type of business funding is the type one is funding own money business.

In the digital online business industry, it is known as bootstrapping which means initial funding by business founders, to reach a certain point. We will explain more clearly about the stages in business funding in the next article.

Funding Business of Others' Money

The second type of funding is to use someone else's money. This type of funding with other people money requires you to release some shares or pay interest on the debt.

Funding Business by Removing Equity (Shares)

Funding a business by releasing equity can occur if your business has or will become a limited liability company (PT). If later your business is incorporated as a sole proprietor or CV there is no term to release shares.

Funding Business with Debt

If you talk about business financing through debt, you know right? The name of debt there must be interest. Well this flower turns out there are cheap and expensive. Let's discuss the expensive ones first.

One of the business funding with expensive debt is debt to the bank (usually business loans are at intervals of 10% - 15% per annum) and in finance companies.

The type of cheap debt is the debt to the supplier or supplier. Sometimes there are people who also use the terms of payment in advance. Example of a restaurant, morning owe vegetables and meat to traders. Tomorrow the owner of the restaurant, just pay the meat and vegetables that yesterday bought. That's obviously debt, but not using interest.

The second example, Buy today's tickets at very cheap prices, and fly next year. Well it's also the type of funding from buyers with the type of payment in advance.

Conclusion

So this time friends are familiar with the types of business funding. How to choose the right type of business funding? Finansialku.com will discuss it in the next article.