Question

What is one advantage of obtaining a business loan from a bank rather than from a venture capitalist

Answer 1

Venture capitalists are looking to get their investment back, even if it’s not in the form of traditional loan repayment. You need to be able to prove a high company valuation in the early stages of your business, which can be a real challenge when you haven’t gotten off the ground yet.

Answer 2

Answer:

The best answer to the question: What is one advantage of obtaining a business loan from a bank rather than from a venture capitalist, would be: banks will give you the loan, and as long as you pay them back, they will leave you alone to make your choices. However, with venture capitalists the problem is that they may become involved in your business as a partner, and they will demand to have a say in how you carry out your business.

Explanation:

Venture capitalists are people, or groups, who lend money to small businesses, and people, in order to be able to carry out their business plans. There are several advantages to them, over banks, who will lend you the money without caring how you use it, but will still charge you for it. However, there are also disadvantages, and one of them is, that these lenders will require you to allow them to have a vote, and a say, in how your business will be carried out. Banks, overall, will lend the money and as long as you pay them back, they will not involve themselves in your business.