Raising Finance

A collection of vocabulary flashcards related to raising finance.

Equity

Money raised by selling shares of a company (ownership).

Debt

Money borrowed that must be repaid with interest.

Loan

A sum of money borrowed from a lender that is repaid over time.

Principal

The original amount of money borrowed (excluding interest).

Collateral

An asset pledged as security for a loan.

Interest rate

The percentage charged on borrowed money.

Risk-averse

Preferring low-risk options, even if returns are lower.

Instalments

Regular payments made over time to repay a loan.

Venture capitalist

An investor who funds startups in exchange for equity.

Seed capital

Initial funding used to start a business.

Cash flow

The movement of money in and out of a business.

Initial Public Offering (IPO)

When a company first sells shares to the public.

Capital gains

Profit made from selling an asset at a higher price than bought.

Blue-chip stocks

Shares of large, stable, and well-established companies.

Bankruptcy

Legal status when a person or company cannot repay debts.

Liquidation

Selling assets to pay off debts, often when closing a business.

Liabilities

Debts or financial obligations owed.

Assets

Things of value owned (e.g., cash, property).

Insolvency

Inability to pay debts when due.

Cash insolvency

Inability to pay debts currently.

Asset insolvency

Liabilities exceed assets.

Default

Failure to repay a loan as agreed.

Business angels

Wealthy individuals who invest in startups.

Exit strategy

Plan for investors to sell their investment (e.g., IPO, sale).