Covore Inc., a start-up firm, receives the majority of the funds it requires to begin its operations from five individuals.In exchange for these funds, each individual receives a share of ownership in the firm.The funds provided to Covore Inc.by the individuals are an example of ________.

Question

Quizplus · Accepted Answer

The individuals who provided funds in exchange for a share of ownership in the firm are engaging in equity investment, as they are investing in the ownership or equity of the company rather than providing debt or asset-based lending. Crowdfunding typically involves receiving investment from a large number of individuals through an online platform, whereas Covore Inc. received funds from a smaller group of investors.