What is the capital of patience?

Patients' capital is another name for long -term capital. With patient capital, the investor or supporter is willing to make some type of investment in the company without expecting that it will be a quick profit. Instead, the investor is willing to postpone any return for a long time. Expectations with the patient's capital is that giving up any type of immediate return will be more significant on the road.

There are many ways to benefit from enterprises and investors. Startup businesses often take at least a year to become self -awakening with generated income. In some cases, this process can take up to five years, provided the enterprise is able to solve the gap on the market. During this period, when investors become self -sufficient, they will not require any type of dividend or interest payments from loans provided to businesses. This leaves a new company without having to fulfill its obligations while it is in the process of becoming establish.

For investors, the expansion of patient capital may be a good thing for two reasons. First, the return on long -term investment of this type often carries more return as soon as the company begins to apply. For an investor looking for an investment that brings a substantial return of five or ten years along the road, the investment of patient capital is a great step in business. Second, there is a potential for tax relief for the amount of investment. While the amount of tax benefits differs from one country to another, many governments tend to offer some incentives as a way of promoting business development.

Investors of patients are usually people who can afford to invest in a long -term project and wait for a longer time to realize the return. Since there is no immediate return with the capital of patients, these investors usually have other references and the income flows have been determined to allow them to manage other expenses and business interests.