I do not have any direct experience with Prosper. From what I see, the vast majority of requests are for personal (not business) purposes. The interest rates on business loans are quite high (usury levels in California).
Of the 50 or so ways to bring capital into a business - I beleive there is probably a better choice.
You raise an interesting point. I’ve never give the white paper idea much consideration – since so many books and other material have been written on the subject. But the way you phrased it is causing me to give it more thought.
Most of the material I’ve seen says that basically capital can be acquired by one of two ways – debt or equity. One either takes on an obligation (either personally or through the company) or sells ownership in the company. While readily accepted, the terms are technically inaccurate since not every “security” transaction is for ownership (equity) and debt can be created via the sale of a security. The real difference between these two categories is how they are treated in the company financial reports –rather than by what means they arrived or from what source they came.
Since all who supply capital expect a return – the amount and the manner in which it will be delivered is of paramount consideration when preparing a capital acquisition strategy.
Some of the primary “variables” in a capital strategy include; the source, the vehicle, the terms and the method /timeframe for the ROI. Using these variables, we have identified over 50 combinations which are viable for small companies.
Thanks again for your input. I’m going create something that expands on the above points.