American Chicken Ltd is a fast food company based in Penzance, specializing in burgers and pizzas. They are currently making a profit; however, they have set two objectives for the next financial year, namely: • Make more profits. • Expand and open another point of sale in Hayle. This report is intended to provide advice to the owners of American Chicken on the best methods to obtain the necessary financing to achieve the objectives set, particularly for the expansion and opening of a new outlet in Hayle. Overview: Whether a business is starting up or growing and expanding, it needs financing to get there. The type and amount of financing depends on several factors which may include: • The type of business – a sole trader will have a much more difficult time obtaining financing than an SA or LLC. A partnership will have income from both partners. where, as an individual entrepreneur, he will only have his own income. • The stage of development of the business – a new business will have more difficulty obtaining financing than an established business. As the business grows, it becomes easier to persuade outsiders to invest in the business. It will also be easier to obtain loans as the business has assets to offer as collateral. • Success of the business – a good track record of success will encourage both lenders and investors. Lenders will have confidence that the company will repay their loan. Investors will be keen to invest in order to share in the profits made by the company. • The state of the economy – if there is a boom, business confidence will be high. It is easy to obtain financing from borrowers and investors. A recession has the opposite effect since investors will be less enthusiastic due to high interest rates. High interest rates also increase the cost of borrowing... middle of paper ...... the advantage is that it is likely that the company will not have to repay the investor in venture capital the money he borrowed, because the The venture capitalist assumes the risk of the business because he believes in the future success of the business. Another advantage is that the venture capitalist can also offer expert advice and industry connections to the company. This can be of vital importance when advertising or when searching for the best supplier. This also benefits venture capitalists because they feel closely involved in the company's activities. However, some disadvantages include the fact that it is difficult for a company to enter into a deal with a venture capitalist due to the accounting and legal risks it must take. A start-up company will also have to transfer part of the ownership of the company to the venture capitalist who invests in it..