Start Up Finance

The entrepreneur will need to finance to the business. This
means they will need to find money to pay for:

The purchase of
plant & machinery, office equipment etc

Renting or buying
premises and offices (e.g. the first 3
months’ rent may need to be paid in

Essential business services such as insurance

purchase of stocks of raw materials and components
to allow production to start

wages and salaries of the first employees to join the
business (who may be needed before any goods or services
are actually sold)

provide financial cover whilst the business waits for
customers to pay

The main ways in which an entrepreneur can find finance for a
new business are:

Own money
Bank loans
Bank overdraft
Money from friends
Grant assistance from government bodies

The business can also split the types of finance into
categories relating to length of time the money is needed for

Short-term: bank overdraft
Medium term: bank loan; lease; hire purchase; government
Long term: bank loan; mortgage; share issue (for limited
companies); debenture