Whether you're a startup founder launching an innovative project or a seasoned enterprise with booming business, adequate capital is the lifeblood for growth and prosperity.

So now you are writing your first business plan or touching up the old one in anticipation of raising capital. Capital can only come into a business in one of two ways. Capital that is generated internally through positive cash flow from business operations (e.g., selling stuff), or from external funding sources. The new entrepreneur is limited to only one option – external funding sources. The established business is hopefully generating positive cash flow, but may require additional capital. Which funding option is best? Is it best that the capital come from only one source, or does it make more sense for the capital to come from multiple sources? How do you decide?

Your chosen funding method is your capital formation strategy. Many factors require consideration based on your team's current situation and future goals. If you're contemplating your next strategic move, our expert analysis can guide you.