Financing A Company

Business Lawyers
Financing A Company

Financing A Company

Business Lawyers

Personal assets

There are three ways to move personal money or assets into a company:

  1. Buy shares from the company and inject capital into the company
  2. Lend the company money through shareholder loans
  3. If you have an existing asset or business you can ‘roll’ it over into the company. Partnerships may also roll partnership property into a company.

Loans

The company can borrow money from shareholders, friends or banks but most companies start out with shareholder loans. Banks may require personal guarantees from the directors or major shareholders to secure larger loans.

Issuing Shares

One way of raising funds, is to start selling equity in a company, in which case the company must issue new shares – voting shares, non-voting shares or preferential (non-voting) shares.