What is the Initial Investment Capital of a Company for New Projects?

Investment capital it is a financial movement of which it is the importation of goods for a specific company. This is done by an expert supervisor on the subject of the initial investment, this organization becomes the owner of the company, since it performs all the calculations and is the one that invests the most time to buy shares.

The initial investment capital of a company is when an organization has the thought of a company and they want to do a company, for this capital there are several options that we must consider, among them are loans from beneficiaries, blank loans by part of banks, among others. This capital has to be a previously spoken amount by the founders of the company, since it will be an amount that will optimize the decision-making of the company.

The main purpose of the initial capital is to safeguard the determining expenses of a companyWe must bear in mind that these expenses will always vary. These expenses are divided between materials, employees, licenses, equipment, services, among others. It is carried out when a company is in the breakeven point.

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This initial investment capital is all that is needed to start a business dream or idea. This must be done in such a way because we do not want a personal bankruptcyIn other words, we should not start as CEO of a company without our own money in our pockets.

What are the types of initial capital?

The initial capital varies according to objectives that the company owns at the beginning, that is, it can be carried out in two types:

Initial investment

They are the expenses incurred in the purchase of products such as machinery, establishments, equipment, land, all the necessary equipment for the proper use of material in the company. The heads of the organization they are the ones who must perform the calculation of all these movements, to search and determine which is the most efficient way for the company. in this type we must take into account the cash flow statement.

Working capital

They are the funds or capital that a company must always have, that is, we must always take this type of capital into account. This is because this type is necessary so that the business of your company can develop without any type of problem, this is used mainly for when disbursements occur in a new company. To get the results of this capital we must do the calculation of, current assets less current liabilities.

Structure of the initial capital

Being a new company, that is, part of a new project. We must have good present the structure to be followed For start-up capital, it is regarded as a business strategy for success. Remembering that this is the way in which a company pays its expenses, its initial operation and its growth of funds.

Investment cost

It refers to the money that the company will use for investment, that is to say, the cost of money to be able to finance itself. This is because companies tend to have debts, and who pays for all these deducted is the initial capital.

Equity-debt ratio

This is the part where more long-term information is generated for the company. Here the accountants must perform all the structure, company calculations and check all changes, all this in order to establish this relationship.

For a company to have a high starting capital for all its new projects, it must have a very positive capital structure.

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Importance of initial investment capital for new projects

Before carrying out any type of new project, we must carry out the strategic planning of the company. We must take into account the initial investment capital, since we will totally depend on the credit we have at that time to do what we want. We must understand that for small companies the capital is limited only to the supplier, while for large companies it will be the supplier and the company’s liabilities.

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