Equity Financing Alternatives for Small Business: A Review of Best Practices in the United States

8. Generic Financing Flow Incentives

The numerous factors that influence an investor's decision to invest are known as financing flow incentives. Flow incentives include usual items such as well written business plans, tax incentives, and good management; however there are a number other elements which are not as easily identified yet have a profound affect on both individual new venture investments and aggregate investment within and across different financing agent categories. The following tables describe the most common flow incentives for each of the financing agents described previously. The tables also identify additional support mechanisms required for the incentives to thrive any given setting, and the stage of growth in which the agent is most likely to invest.