Question

3. An entrepreneur can get cash from: Savings, personal loans. credit cards, bank loan, venture capital and angel investors, government programs, corporate programs, crowdfunding and crowdlending.

Select two of these options. Compare them. Where can these funding options be obtained? In 100 words or more, explain why you would picked these options for funding your business.

Answer 1

If I had to get cash from various sources for my business as an entrepreneur I will choose-

1. Venture capitalist-these are the persons who invest in your business and are part of your equity after assessment of the business potential and growth opportunities. They have the specialisation into investment of such business and they can also offer with various suggestion regarding management of the company so they can not just be helpful in obtaining of funds, but they can also be helpful in decisions regarding various managerial strategies.

2. Bank loans-I would opt for this kind of debt financing because it will also help me to gain interest rate tax advantage as the interest rate which are payable on such bank loan would be tax deductible and it will help in enhancing my profit at initial stages of my business.

I would pick this two because one would provide with their expertise and another will provide with the tax advantage associated with the debt financing.