FINANCIAL FLEXIBILITY
Tuesday, June 4th, 2013What is the difference between loan investment and benevolent venture capital equity investment? The jargon is different. No loans, just equity. No hard collateral, just Shepherding. No interest, just dividends. No monthly payments, just an exit strategy in the form of a buy-back clause in the equity agreement to give a fair return to the institution and allow the enterprise to own 100% of its shares when the cash flows are strong enough. Venture capital addresses all the needs of the enterprise. What is needed is the belief by financial institutions that “Shepherding as collateral mitigates the risk of business failure”.