A Debtor is a slave. I have heard that many times. It seems true because debt servicing and interest rate can be killing! It can even sap away the capital base of the business. Truly, Everyone hates debts. So why will I even suggest this topic?
There are several reasons behind my conclusion and its open for discussion and analysis. Business thrives where there's bumper inflow of income over the outflow of expenses. Also, many business flourish when there is varieties and such needs more money. Where can one get more money? In a sane situation, banks and other financial institutions can be of help. Meeting their requirements, boom! The money will come for the business. This form of money depending on any kind of name attached but with repayment plans, will be known as a loan and its debt plan.
Loans and Startups can be related or hard to separate.
Many startups where the owners with low capital base still depend on loan of various debt plans to build up. Few are successful and thriving while others failed, not because of money but other logistics not handled very well. Its only those owners of startups with balls take loans which others chickened out.
Debt are free and easy.
Hardly, There's no business that thrives without debt and use of it can exempt the business empire of certain tax concerns and low interests. Its the best way of financial sources. Only wealthy and rich people knows that. Its easy to get and free so far that conditions are met. Main reason is that the lending institutions want to make money and ask for more people to take loan
The nature of debt and its service.
The danger of some debt services is their hidden charges and high interest rate. If the nature of the debt is honest and transparent, many business owners will depend on it. It should be expressive and understood. Many of these lenders are greedy thereby keeping their clients as a financial milk cows. Avoid those ones, not debts or loans because you needs more money for your business to thrive.