Small and Medium Sized Scale Enterprise (SMEs) Finance...

1.Introduction Small and medium sized scale enterprise ( SMEs ) occupies the crucial position among the worldwide economic activities, particularly in developing country, whose flourish has already became a sign of the rapid development of economy. However, more than half SMEs face the severe challenges of surviving. Among all the possible threats during business activities, inadequate access to capital is the most important factor to determine the enterprise’s destiny (CCH, Australia, 2013). Even worse, SMEs are under the tremendous stress of the financial and economic crises which lead to the depressed consumer market, contractive loan of financial institutions. Given the important place of SMEs in world economy and the worsening global†¦show more content†¦Because of its flexibility and spontaneity, which helps angel investment becomes the favorable financial assistant for technology-oriented SMEs. The practice in many countries indicates that fund rising in hi-tech industry companies mainly rely on angel investment instead of formal capital market at their preliminary stage. The involvement of angel investor would mean that venture capitalists and bankers are highly likely put more investments or loans into company’s future development. The â€Å"stepping-stone† effect of angel investment has worked on numerous famous international companies nowadays, including Apple, Amazon, Ford, etc. Steve Jobs and his copartner Stephen Wozniak received the investment from Mike Markkula (American entrepreneur and angel investor) to manufacture the Apple II personal computer they had developed in 1977. It is because the one million dollar’s angel capital, that helps Apple to build the rock solid foundation for the future success. Mezzanine Finance Mezzanine finance is often being seen as a combination of both debt finance and equity finance, whose risk level is between debt financing and venture investment. When mezzanine finance providers lend money to the company who has financing need, they will also seek to share in growth by building an element of equity investment into the deal (Williams, 2013). The advantage of mezzanine finance is obvious: friendly cash flow. This is attractive to borrowers when they are frustrated about theShow MoreRelatedAnalysis Of Small And Medium Sized Firms5763 Words   |  24 PagesENTREPRENEURSHIP; Analysis of small and medium sized firms (Small and medium scale enterprises: SMES) By Daniel Abioye, INTRODUCTION Small and medium sized firms play a prominent role in economic development (Osotimehi, et al. 2012). Hence it has been the underlining background to this study. The importance of SMES cannot be overemphasized in an economy. This is because they contribute to the creation of employment, free competitive market environments, inputs for large scale industries and so on. DruckerRead MoreSmall or Medium-Sized Enterprise (SME) Essay1817 Words   |  8 PagesBACKGROUND Small or medium-sized enterprise (SME), of which definition varies in different countries and different economic development levels, normally is known as relatively small business unit in terms of employees, capital and operations scale in compared with large enterprises in the same industry. In spite of the diversity of its definition, SME plays a crucial role in almost every economy, tremendously contributes to economic development, job creation, and social stability. According toRead MoreIssues in Sme Development in Ghana and South Africa6623 Words   |  27 PagesJournal of Finance and Economics ISSN 1450-2887 Issue 39 (2010)  © EuroJournals Publishing, Inc. 2010 http://www.eurojournals.com/finance.htm Issues in SME Development in Ghana and South Africa Joshua Abor Department of Finance University of Ghana Business School, Legon Peter Quartey Institute of Statistical, Social and Economic Research University of Ghana, Legon Abstract This paper discusses the characteristics, contributions of SMEs to economic development, and the constraints to SME developmentRead MoreExplain what sources of finance are available for small to medium sized companies and explain why they sometimes face difficulties in raising finance2495 Words   |  10 PagesIntroduction 3 1 Some important financing sources for SMEs 4 1.1 Different stages in raising finance 4 1.2 Venture Capital: a light of hope for the SMEs 5 1.3 Leasing and Factoring: special survival skills 7 2 Difficulties for SMEs in raising finance 8 2.1 Biggest trouble: lack of credit records 8 2.2 Capital constraints 9 2.3 Other barriers 10 3 Conclusion 10 Reference 11 Explain what sources of finance are available for small to medium sized companies and explain why they sometimesRead MoreLimitations for Sme Internationalisation5917 Words   |  24 PagesTable of Contents Literature review 3 SME internationalization 6 Barriers 8 Internal barriers 11 External barriers 17 Conclusions 20 List of literature 22 Literature review The first article I used was SMEs Barriers Towards Internationalization and Assistance Requirements in the UK† published in Journal of Small business and Entrepreneurship. 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Sources of such financing can be either internal or external to these enterprises, however research identifies external financing, and particularly bank financing as the most common source (Barton Matthews, 1989; Jacobson, Lindà © RoszbachRead MoreProblems and Prospects of MIS in Bangladesh6554 Words   |  27 Pages MIS in Bangladesh --------- A perspective study on SME Declaration 21st December,2011 Md. Rahimullah Miah Lecturer Dept. of Business Administration Leading University,Sylhet. Subject: Submission of report on â€Å"Problems and Prospects of MIS in Bangladesh† ----- A perspective study on SME Dear Sir, I would like to thank you for assigning us this