Funding

Question 1

All income = ?

Answer 1

= Net profit - taxes, expenses

Question 2

The grouping of Funding?

Answer 2

1. Internal sources
   * Personal Funds
   * Retained profit
   * Sale of assets
2. External sources
   * Private Investors
   * Loan capital(different kinds)

Question 3

What is retained profit = ?

Answer 3

= Net profit - Dividend

dividend: the money that a company pays to the shareholders

Question 4

What are assets?

Answer 4

Anything you can use to generate money in the company

Question 5

What is collatoral?

Answer 5

Something you have to pay to the bank if you fail to pay the loan

Question 6

What is the fixed interest rate?

(loan capital)

Answer 6

A fixed interest rate is an unchanging rate charged on a liability, such as a loan or mortgage. It might apply during the entire term of the loan or for just part of the term, but it remains the same throughout a set period.

Question 7

What is the Variable/floating interest rate?

(loan capital)

Answer 7

A floating interest rate, refers to any type of debt instrument, that does not have a fixed rate of interest over the life of the instrument. Floating interest rates typically change based on a reference rate

(hungary: 12.84)

Question 8

Business development loan

(loan capital)

Answer 8

cheap interest, long time to pay back, government gives them

Question 9

What are Bonds?

Answer 9

You can buy them at the bank. You loan money to the business.

yield: the annual percentage, it tells you how safe it is to take a bond

Question 10

If a company goes bankrupt in what order does the people get paid?

(loan capital)

Answer 10

1. Bondholders
2. Employees
3. Other companies they owe money to
4. shareholders

Question 11

What is a dementure?

(loan capital)

Answer 11

It is a bond without a collatoral, if the company goes bankrupt you get nothing.

higher yield -› incentive

Question 12

What is overdrafting?

(loan capital)

Answer 12

Taking a not planned loan
+ taking the money immediately
- interest rates are very high to force you to pay it back as early as possible

Question 13

What is trade credit?

(loan capital)

Answer 13

A trade between two companies, when one only pays after using/getting the survices, keeps people in business

Question 14

Insolvancy

Answer 14

When a company does not have enough cash but it is not bankrupt

Question 15

What is a grant or subsidy?

(loan capital)

Answer 15

Grant: Government gives the money, companies do not have to pay it back
Subsidy: not money, but like tax break
- lots of paperwork

example: youth unemployment

Question 16

What is debt factoring?

(loan capital)

Answer 16

Selling the debt to debt collecting companies who then make the person/company pay

The company who is owed to does not get the original amount of money back but it is more than nothing

Question 17

Who are Venture capitalists or Business angels?

(loan capital)

Answer 17

it is mostly a person(but it can be a company too), they try to find the next good things and fund them
+ money, advice, contacts
- venture capitalists tend to take over the control

business angel: cares more about the idea
venture capitalist: cares more sbout the money

Question 18

What is IPO or shared issue?

(loan capital)

Answer 18

When the company goes on the stock market(not for new companies 10-20 years)
+ free money
- but giving away some control

IPO: Initial Public Offering

Question 19

What is Crowdfunding?

(loan capital)

Answer 19

Investing but no profit, instead some kind of benefits

pl: patrion.com
kickstarter.com