How to invest money into a company is a question confronting many who want to build a future in this lucrative field. Investing in a business is one of the most popular ways families begin the journey to financial freedom. It isn’t uncommon, at least in nations with an entrepreneurial history such as the United States, for someone to have never owned a publicly traded share of stock or a mutual fund, but have their own restaurant, dry cleaning business, or sporting goods store. Frequently, this grows to represent the most important financial resource the family owns, other than their primary residence. When you make a debt investment in a business, you loan it money in exchange for the promise of interest income and eventual repayment of the principal. Debt capital is most often provided either in the form of direct loans with regular amortization or the purchase of bonds issued by the business, which provide semi-annual interest payments mailed to the bondholder. Sometimes, business investments straddle the ground between equity investments and debt investments, modeling preferred stock. Far from offering the best of both worlds, preferred stock seems to combine the worst features of both equity and debt; namely, the limited upside potential of debt, with the lower capitalization rank of equity. There are always exceptions to the rule. Cartagena, Colombia
