2.1 Raising Finance

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Marketing

A-Level Business

Edexcel

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4 Terms

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Retained profit

Profit kept in the business after tax and dividends.

  • No repayment or interest; – May limit reinvestment elsewhere.
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Sale of assets

Selling unused buildings/equipment.

  • Frees up cash; – Not sustainable long term.
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External resources

  • Loans: Borrowed from banks; paid back with interest.

  • Share capital: Selling shares (Ltd or PLC).

  • Overdrafts: Short-term, flexible borrowing.

  • Venture capital: Investors in exchange for equity.

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🧠 Key idea

Match the source to the business’s situation (start-up vs established, short-term need vs long-term investment).