Incorporating a Business and Getting Capital?
Posted by admin on 5 Jul 2009 4:15 am. Filed under Economics.
Alby
If I file Articles of Incorporation and thus Incorporate a business, what does a bank/lender look at when issuing lines of credit to an Incorporated Business? Does the business need to show assets to secure a loan? Or does the very nature of being Incorporated justify at least a minimum amount a lender is willing to risk on a business?
This is of course given that you have a business plan and will actually put the money to use in making the business successful. But I’m talking about starting out on Day 1 with $0.00 and Zero Assets for the business?
If I file Articles of Incorporation and thus Incorporate a business, what does a bank/lender look at when issuing lines of credit to an Incorporated Business? Does the business need to show assets to secure a loan? Or does the very nature of being Incorporated justify at least a minimum amount a lender is willing to risk on a business?
This is of course given that you have a business plan and will actually put the money to use in making the business successful. But I’m talking about starting out on Day 1 with $0.00 and Zero Assets for the business?
Or is the only option for a newly former Incorporation to seek Venture Capital and hand over partial ownership to those Venture Vultures?
2 Comments to “Incorporating a Business and Getting Capital?”
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On July 6th, 2009 at 12:26 am
There is no bank giving credit to a full-beginer company or for to register the capital of a company. The capital must be provided by the owners of company and take the risk of lost it.
If you want to create a company and you need more capital, you must look for an associated or abandon the idea.
Banks and lenders give loan to a group of company that can demonstrate they can pay the money plus the interest, even if the business plan fail… financial statements are usually a document that demonstrate them what money you can receive like a loan; however if the analysis of banks fails and you do not pay the loan …they will go for you…
In Europe, Asia and Latin America there is banks oriented to stimulate to entrepreneur and give goods possibilities to pay in case the company get financial problems…maybe you must look in your locality this kind of institution.
On July 8th, 2009 at 8:56 pm
Speaking as a Vulture, you do not have to seek capital from any of us. You are free to provide it yourself or from friends and family. In fact, that’s exactly what most start-ups do until they have enough of a business going to attract private equity investment.
And what do you mean “hand over”? You want others to risk their money in exchange for simply watching you use it. Get real.