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Developing Hospitality Properties - Essay Example
Pages 4 (1004 words)
Developing hospitality properties: Raising funds Insert Institution Date Introduction The process of raising funds is recorded as one of the most daunting and demystifying processes in a business that may discourage an entrepreneur to the extent of giving up…
The next step is deciding the best ways to raise money which will be discussed in this paper. Debts are very available and utilizable sources of funds for any purpose. According to (Walker, 2009), commercial banks are among the best and most common sources of loaning finances. Such funds come in the form of loans which are usually sufficient for all needs. Such loans are classified according to the repayment period. Term loans are repayable over a long period probably longer than a year, an intermediate loan is repayable within five years and there are those loans that take longer periods of over 20 years. However, such loans are not easily acquired and this is one of its restrictions. Barrows and Powers (2008) explicitly state other limitations of such loans as; security is mandatory, some interest rates are very high and the risk of receiving due to defaulting the loan are usually high. A lot of capital is required in this restaurant keeping in mind the myriad of services it is intended to offer. According to Hunt (2008) this is one property of a high risk business because the surety of the population feeding on spicy Indian cuisine is not 100% guaranteed. Therefore, he states that the other kind of debt can be through venture capital. In this case, the venture capital source is refunded through owning equity in the restaurant. ...
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