A review of the contemporary capital funding options and sources to support businesses, enterprises and entrepreneurs at different stages of life cycle with a comparative review of key indicators like size of venture fund, number of investments, types of industries, types and sizes of companies invested in, major factors for evaluating potential investments, valuation methodologies and application procedure and financing types and success rates. Young entrepreneurs find it very challenging to get funding from contemporary financing channels and institutions to finance their unique business ideas. Established financing institutions lack of interest in exploring entrepreneurial potentiality have taken such a conservative form that newer breeds of capital financing have emerged on the horizon over last few decades. Especially since the wide spread-out of social media and people contacts over internet has made the growth of KickStarter, GoFundMe, IndieGoGo etc as part of modern financing history. This paper describes such five capital financing options for innovative business minded people, entrepreneurs and young startups with their instances in detail. Are you looking for a paper writer? Are you worried about writing an essay for your college or university? Leave the tension, simply contact me. I am offering the best quality academic and research papers, thesis, essay writing, term paper and dissertation writing service, right in your budget! Have a look at my profile and see what hundreds of people like you have said about me. Connect here at https://www.freelancer.com/u/brohhma.html or email at kuasha1981@gmail.com

1. Capital Funding
Peer to Peer Lending, Incubator, Loan
Capital, Crowdfunding and Angel
Investors

2. Introduction
Young entrepreneurs find it very challenging to get funding
from contemporary financing channels and institutions to
finance their unique business ideas. Established financing
institutions lack of interest in exploring entrepreneurial
potentiality have taken such a conservative form that
newer breeds of capital financing have emerged on the
horizon over last few decades. Especially since the wide
spread-out of social media and people contacts over
internet has made the growth of KickStarter, GoFundMe,
IndieGoGo etc as part of modern financing history. This
paper describes such five capital financing options for
innovative business minded people, entrepreneurs and
young startups with their instances in detail.

3. Funding Types Described
• Crowdfunding
• Crowdfunding stands for networking individuals who
pour their money to support any initiative on internet
platform by any entity. It is an adapted form of
crowdsourcing and differentiates itself by focusing on
the intent of the concept that to be funded through
individual contributions. CircleUp stands as one of the
most popular crowdfunding service at the moment.
• Angel Investors
• In general terms Angel Investors are those individual or
group of individuals who invests in start ups in
exchange of ownership stakes.

4. • Peer to Peer Lending
• Peer to peer lending is rather non-institutional since it by passes the traditional
financing system and relates unrelated individual to lend money. Nowadays this
has taken the form of using internet platforms where each funding requirement
are different in its terms and scopes but enjoys some common security
arrangement invested by the internet platform.
• Incubators
• Incubators are rather all inclusive approach to financing where lead entrepreneur’s
personal conceptualization of the business are mostly supported with office space,
shared administrative support, financial support and mentoring. This differs from
other capital financing in many ways because such programs provide an
opportunity to groom up an entrepreneur and empowers him with greater ability
to get funding from different sources.
• Loan Capital
• Loan Capitals are defined as structural funds for SMEs in private sector where the
interest rate get subsidized or rebated in repayment. An important difference
prevails with loan capital and other loans. These are meant for those funding
requirements where administrative procedures are burdensome. These funds are
disbursed on individual and group basis and are quite adaptive of the
development sectors microcredit lending.

5. Finnvera – A Loan Capital
• Finnvera
• Finnvera is a Finnish capital financing service that funds enterprises at growth, start up and for
internationalization. It has multiple arrangements like venture capital investment, export credit,
loans and domestic guarantees. It is run and managed by the State of Finland.
• Size of Venture Fund
• As of December 31, 2014 Finnvera has over 2.8 billion Euros outstanding commitment in SME
financing and 12.2 billion Euros in export financing. Currently there are 28800 customers.
• Number of Investments per year
• Over 2208 enterprises were financed at growth level and 3247 start up enterprises in 2014 while
the SME financing was 1003 million Euros and export credit was 5034 million Euros.
• Types and Sizes of companies invested in
• The Finnvera entrepreneur loans are targeted to any sector except farming, realty, forestry sectors.
However, any other industry that is beyond the reach of contemporary financial institutions are also
the one where Finnvera holds strong interest in investing. Generally, these loan amounts vary with
upper limit set to 100000 Euros.

6. • Factors in evaluating potential investments
• Finnvera’s evaluation for potential investment involves ensuring the
limited liability status of the company where the applicant must be having
atleast 20 percent of all voting and shareholder rights. At the same time, it
must also comply with the basic general guideline of preferences detailed
by the EU’s SME initiative. Applicants do not need any collateral to deposit
as Finnvera’s financing decisions are solely based on the prospect of the
business.
• Firm Valuation methodologies
• Finnvera’s perspective of financing is slightly different that others as it
believes entrepreneurs seeking funding must be having a complete
financing plan for the business. As such applicants funding request from
Finnvera is just only one part of the entire financing plan and that
financing plan can should include complete targets, strategies, plans,
market situation assessment and should clearly visualize how the financial
plan is going to get returned with profitability and sustainability.
• Requirement on Entrepreneur’s proposal’s length, structure and details
• Finnvera has downloadable application form on its website which needs to
be filled up with all required details and submitted to the site. Upon
review of the application form Finnvera it will make contact with the
applicant to describe the future procedures.

7. • Types of financing
• Finnvera offers multilateral financing arrangements like
seed loan, internationalization load, entrepreneur loan,
Finnvera loan, financial bridging loan, grants and bond
financing. Also there is a 3.25% interest fee and six months
grade period and repayment can be extended upto 10
years. Applicants own share in the stock is assumed as a
security and the whole process has a nominal fee.
• % of applicant and financed
• Finnvera stands as one of the most popular financier in the
EU only due to its flexible terms and supportive nature. It
has strong number of applicant who are already financed
with billions of Euros while few billion Euros are still left
with the organization to finance. At estimate 25% of all
applicants are successful in getting funding however those
who require less than 35000 Euros are even more highly
successful in securing Finnvera financing.

8. Conclusion
In this report we have discussed different capital funding
methods with their instances to different questions. The
intention was to familiarize the growing forms of capital
funding and it included Peer to Peer Lending, Incubator,
Loan Capital, Crowdfunding and Angel Investors. Each has
its own way of working and purpose, while all of them are
desperately looking to find that unique business where
they can invest the money. It is their form of business – if
they cannot invest in time, they will not run profitably in
the future. They will not be able to grow. And if an
entrepreneur can present a sustainable, unique and
competitive leverage based business plan; these capital
financers will jump in to join the entrepreneur with their
money. The fact is, there is money if one has a plan.