Because investors and commercial lenders both seek returns on the funds given to startup firms, entrepreneurs can obtain financing as easily from either source.

Question

Quizplus · Accepted Answer

While both investors and commercial lenders provide financing to startup firms, they have different motivations and requirements. Investors are looking for a return on their investment through equity ownership, while commercial lenders are looking for repayment of a loan with interest. This difference in motivation and requirements can impact the ease of obtaining financing from one source versus the other.

Because Investors and Commercial Lenders Both Seek Returns on the Funds