Funding Sources within Upcoming Entrepreneurs Research Paper

Funding Sources within Upcoming Entrepreneurs - Research Paper Example This is the scenario where there emerge various businesspersons who are willing to start their own businesses for the purpose of providing better services to the people, which in the process results to better profit realization. Consequently, in the process of starting a new business organization, entrepreneurs should make sure they consider and meet various factors such as capital, labor and better management in order to avoid the collapse of the organization at its early stages. Moreover, the emergence of these business organizations are helpful as they results to the creation of job opportunities within the given environment, therefore, they should be encouraged. Thesis Based on the development of new businesses, this paper provides the three types of funding sources that an entrepreneur should considers during capital generation, some of the merits of the provided funding sources and their disadvantages. It also provides some of the factors that the lender should consider in the borrower and some of the ways in which the information need to be presented to the lender. The research paper also provides some of the procedures that need to be followed in future in during the process of entrepreneurial endeavor and some of the ways in which entrepreneurs may manage to start their own businesses. ... Question 1: Types of Funding Sources to Entrepreneurs During the process of coming up with a business organization, there are various factors that an entrepreneur should consider for the success of the business to be achieved. One of the main factors to be looked at is the capital for starting the proposed business. Therefore, there are three main types of funding sources that an entrepreneur should consider in the process of generating capital for starting a business. These include: Debt Financing Through the process of debt financing, an entrepreneur is required to apply for loans from various financial institutions such as banks and non-government institutions. Therefore, before an organization decide to borrow money from these institutions, the need to consider the lending process, interest provided and the period in which the organization is required to settle all their debts. If the information provided by the banks complies with the situation of the business, the entrepreneur needs to apply for the loans (Viramgami 178). On the other hand, for the bank organization to strike the deal with the organization they need to consider the cash flow of the organization and the security that the proposed organization provides against the loan provided. Grants This is the process whereby various entrepreneurs become part of some of the government agencies within their respective countries. For instance, in the United States, most of their new entrepreneurs who are willing to start small businesses become members of the Small Business Administration, which is part of the Small Business Innovation Research programs (Talloo, 78). Therefore, in the process of becoming part of these government organizations, these people are in the position of getting help