Other Methods of Raising Finance, including the use of Special Institutions

Abstract

So far in Part Two the way in which we have discussed the various topics has been determined very broadly by the organisation’s size and stage of development. We have progressed from a sole trader and partnership to a limited company and discussed how the latter may obtain finance from outside the ambit of the family and friends, and what form this finance should take. In this chapter it is our intention to discuss other financial sources, including facilities available to the more established company. Fairly obviously such companies can use the bank, trade-credit and hire-purchase facilities discussed in Chapter 2 as being suitable for the new business, but the established company can also benefit from sources of finance made available only to those companies with a successful record. To some extent this has already been explained in connection with long-term finance, i.e. access to the capital market via the stock exchange. In the following pages we discuss other sources, including the principal specialist finance corporations. Finally, part of this chapter is reserved for discussing the finance of a special situation or industry, e.g. transfer of assets on death (or other times) and agriculture.