Raising Capital Question 1

Business & Finance
Tutor: None Selected Time limit: 1 Day

You have just started a new technology venture and need short-term cash; you are willing to provide a personal guarantee and have paid in equity of 20%; what sources would you pursue, and why?

Oct 12th, 2015

Thank you for the opportunity to help you with your question!

As my company is new and I need only short-term cash, I will take a loan (debt) from an angel investor. I will do so for 2 reasons -

1. Angel investors understands the dynamics of  a new company and will not create undue problems.

2. I may be able to create a good relation with the investor. Having understood the business potential, he may be willing to invest in long term and become a partner.

I will refrain from going to a bank (though it is the second best option) as banks usually have strict guidelines and payment terms. Not that I will default, but having an angel investor as partner will be more useful.

Please let me know if you need any clarification. I'm always happy to answer your questions. Kindly best this answer if it has helped you.
Oct 12th, 2015

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