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/biz/ - Business & Finance

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727509 No.727509 [Reply] [Original]

Lender or Equity investor. Which is a better position to take?

>> No.727513

>>727509
Depends on whether you can service your lenders or can't. Also depends on what the equity investor can bring to the table.

>> No.727516

>>727513
I mean from the investor side not the business owner side.

>> No.727535

There can be a combination, like shadow banks, but I'd say investor

>> No.727554

>>727516
>from the investor side
Well a creditor can gets his money back plus interest, typically 0-10%. The business is legally obliged to pay creditors. An investor can gain upwards of 10,000% on a successful startup. But there's no law to pay equity investors.

Investor = more returns, more risk.
Creditor = less returns, less risk.

>> No.727561

>>727554
>typically 0-10%
*per annum

>> No.728186

>>727561
10% would be amazing. Do only banks and other financial institutions pull those returns? Can a humble guy like me get in on that?
I never see bonds at 10%

>> No.728224

>>728186
Well I talking more about venture capital/private placements because that's your thread sounded like it was about.

But yes you can get 10% on junk bonds/preferred stocks. Not really ideal playing ground for a retail player, more institutional.

I'd just invest in index funds personally.

>> No.728254

>>728186
I'm getting 15% as a mezz lender in a residential real estate development.