Use Other People’s Money? It Depends… The Risk of Other People’s Money Often clients come to me indicating they want to raise money. So I get to ask the next questions: “Equity?” “Debt?” “Or some combination of these?” The response is too frequently a glassy-eyed: “You tell me.” To compound their initial frustration, my answer is usually, “It depends.” Everything has a price, including money. At its most basic, that price is normally interest or return on capital. In the real world, however, the intangible conditions associated with outside funding can be as costly to the entrepreneur as any additional premiums...
Read More