Raising Finance

3. The early stage (sowing a seed) finance that might come from an angel investor.
4. Business finance that has no guarantee of repayment or of an annual income, but gains a share of the control of the business and its potential profits.
8. A company with limited liability and shares, which are available to the public. Its shares can be quoted on a stock exchange.
10. Short-term borrowing from a bank. The business only borrows as much as it needs to cover its daily cash shortfall.
12. Those owed money by a business – for example, suppliers and bankers.
13. A pessimistic estimate assuming the worst possible outcome – for example, sales are very disappointing.
14. A one person business with unlimited liability.
19. Owners are liable for any debts incurred by the business, even if it required them to sell all their assets and possessions and become personally bankrupt.
20. An optimistic estimate of the best possible outcome. For example, if sales prove much higher than expected.
21. Obtaining external finance from many individual, small investors, usually through a web-based appeal.
22. Those costs that do not change as the number of sales changes.

1. The finance available for the day to day running of the business.
2. Ordering stock so that it arrives just before it is needed, just in time. i.e. having no stockpiles to cover for late deliveries.
5. An asset used as security for a loan. It can be sold by a lender if the borrower fails to pay back a loan.
6. Investors who back a business before it has opened its doors, taking a full equity risk, i.e. if it fails the investor will lose everything invested
7. High risk capital invested in a combination of loans and shares, usually in a small dynamic business.
9. Owners are not liable for the debts of the business; they can lose no more than the sum they invested.
11. Those costs that vary with the output of the business
15. A document setting out a business idea and showing how it is to be financed, marketed and put into practice.
16. When an individual is unable to meet personal liabilities, some or all of which can be as a consequence of business activities.
17. A market for buying and selling company shares. It supervises the issuing of shares by companies. It is also a second-hand market for stocks and shares.
18. Estimating the future cash inflows and outflows, to find out the net cash flow.