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Chapter 15

5.2 Leasing

Long-term lease arrangements would be used as debt finance for assets that have a
useful life over the medium to long-term period.

 Lease generally covers the whole useful life of the asset

 Lessor does not usually deal directly in this type of asset

 Risks and rewards of ownership generally passed to the lessee.

 Lease agreement cannot be cancelled

5.3 Venture capital

Venture capital is the provision of risk-bearing capital, usually in the
form of a participation in equity, to companies with high growth
potential.

Venture capitalists provide start-up and late stage growth finance,
usually for smaller firms and will often look for an exit route in the form
of flotation of the company enabling them to sell their investment.

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