Companies have different ways to finance themselves their activities. We can make a distribution in two groups. First, the capitalĀ“s contributions are an amount of capital that has been invested in the company by the owners. On the other hand, the cash flow that are generated internally.

At this moment, more and more companies prefer begin as private limited companies, where the capital are divided in shares, but also can adopt other forms of company. But always, the company must calculate the amount of money that it needs to search the future shareholders, which will make the investment.

If we analyze this first way to how finance themselves, we will find advantages and disadvantages in this. Maybe, it is the best way to increasing the assets. Apart of from, we will can to face more liability for debts. However, there is a disadvantage, because the family owner lost power in the partnership and have to distribute dividends.

Then, we refer to shelf-financing, the other way. This financing born in the company and it is obtained by the performance. When the incomes are bigger than the expenses, obtaining a positive cash flow, the directors will use part of savings to make investments.

If the economic growth in the company is positive, increasing the turnover, the company will have hedging, and so, obtaining a good cash flow it will be possible to finance themselves. Also with these resources it was being possible to speculate. But there are some risks, for example lost the saving.

These measures to finance are the key to develop a company.

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