Many companies choose to sell bonds to investors so no ownership is transferred.
You started in a garage or spare room, or perhaps you had a small office somewhere in an inexpensive office complex. This can, of course, be a strain on the company's finances especially. This is where stocks and bonds come in. You need to hire new employees, buy computers and office furniture, and of course you need to rent or purchase a much bigger office space.
Bonds give a company an advantage because it doesn't have to give up any of its ownership in order to raise capital. Well, unless you have a significant amount of savings in your personal or business account, you will need to borrow the money or sell ownership in your company.
However, a hyman does require a company to pay back the IOU with interest. However, you have had some success and now need to grow your business. Let's say you need to grow your business. How would you get this kind of money. A stock is a share of ownership in a corporation, while a darin is simply a loan that must be paid back with interest. |