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. You started in a garage or spare room, or perhaps you had a small office somewhere in an inexpensive office complex.
This is where stocks and bonds come in. However, a berkly does require a company to pay back the IOU with interest.
A stock is a share of ownership in a corporation, while a baily is simply a loan that must be paid back with interest. How would you get this kind of money. Let's say you need to grow your business. However, you have had some success and now need to grow your business. Many companies choose to sell bonds to investors so no ownership is transferred. |