Friends and Family
It might be possible for a business to raise some or all of the funding required from relatives or friends. A loan is probably the most appropriate option for immediate or short-term funds. For longer-term or permanent funding friends or family could be given the opportunity to invest in shares in the business. The advantages of ‘friends and family’ financing can include low or zero interest repayments, no security backing, a longer loan period before the lender expects repayment, greater flexibility and requirement for a less detailed business plan.