WSEAS Transactions on Business and Economics
Print ISSN: 1109-9526, E-ISSN: 2224-2899
Volume 13, 2016
Taking the Financing Decision Considering Various Funding Possibilities for Entrepreneurs
Authors: ,
Abstract: Entrepreneurs in emerging countries have various and numerous innovative ideas that imply solutions for developing new or existing companies. Technological enterprises have the most to benefit from these ideas, but unfortunately they have few possibilities for implementing them. In the current paper we propose a method that can be a highly objective and helpful tool in determining the best financing solution for an enterprise with no or insufficient funds. The proposed model and analysis determines the total profit obtained from developing a project, by taking into consideration two possible cases. The first case determines the profit obtained after financing the project with borrowed capital from a bank, a private person or company which demands an interest. The second case that the model takes into consideration is obtaining a public fund, governmental, European or other public funds. Also taken into consideration is equity financing, a particular case of loan-based financing. The model proposed in this paper is a fast decision instrument for entrepreneurs, for identifying the most profitable solution for financing their innovative ideas, applicable both for a large enterprise but also for a start-up.
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Keywords: Virtual Enterprise, Funding sources, Borrowed capital, Regional Development, Business Models, Profitability, Comparison, Forecast
Pages: 283-291
WSEAS Transactions on Business and Economics, ISSN / E-ISSN: 1109-9526 / 2224-2899, Volume 13, 2016, Art. #26