研究生商务英语课件6.pptVIP

Unit 6 Raising Finance Learning Objectives: To identify and understand finance and finance-raising. To demonstrate the types and sources of finance. To grasp the methods and skills of raising finance. “Money makes money, and the money it makes, makes more money.” “You can do nothing without money.” Where can you find money? How should you manage it? What is finance-raising? Finance ? Raising finance? Why raising finance? To meet needs of a growing business To finance an MBI or MBO Type Description Example Debt finance Finance is repaid with interest over a specified period of time. No ownership of your company by lender. Bank Finance Equity finance Exchange of money in return for an ownership stake in your company. Stock, Venture Capital funding Type of finance required Remember ! A key consideration in choosing the source of new business finance is to strike a balance between equity and debt to ensure the funding structure suits the business. (an optimization of capital structure) Sources of finance Internal --- ‘Organic growth’ ‘Organic growth’ – growth generated through the development and expansion of the business itself. Can be achieved through: Generating increasing sales – increasing revenue to impact on overall profit levels Use of retained profit – used to reinvest in the business Sale of assets – can be a double edged sword – reduces capacity? External --- ‘Inorganic Growth’ ‘Inorganic Growth’ – growth generated by acquisition (merger and takeover) Long Term – may be paid back after many years or not at all! Short Term – used to cover fluctuations in cash Long term Loans Bonds Stocks Retained earnings depreciation Bonds Actually an IOU A written contract which stipulates the par value, the maturity date (usually 10 to 30 years) and the interest (paid quarterly, semi-annually or annually) rate. Pref