Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Equity funding is just one source of funding for your startup. There are many others such as equipment leasing.

Equipment leasing is used to reduce cash requirements for a startup by leasing the equipment rather than buying it. 

An equipment leasing company owns the equipment and uses it as collateral for buying the equipment and then charges the startup a monthly rental fee.

There are two types of leasing. The Finance Lease (also called the Capital Lease) and the Operating Lease. 

The Finance Lease is a long-term arrangement in which the startup is required to pay the lease rent until the end of the contract, which is usually the life of the asset. 

The Operating Lease is for a shorter period of time and is often cancelable. 

Providers of equipment leasing must have a license and cannot hold or offer real estate. The lease period cannot be fixed for less than three years, except for IT and computer equipment.

Leased equipment appears as an expense on the income statement rather than on the balance sheet, which would reduce the startups’ liquidity.

Over the long term, the cost of the asset will be higher than that of an outright purchase.

It’s best to look for a closed-end lease without a balloon payment at the end. 

An open-end lease requires you to pay the difference between the value of the equipment and what you’ve paid for it so far.

Equipment leasing works best for cash- flow management when you have a long-term need for the equipment.


Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
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Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Equipment leasing lets you borrow funds to obtain assets such as computers, machinery, and other items you may need to build your product and run your business. 

Instead of raising equity funding to buy the equipment, you can lease the equipment.

Equipment leasing spreads the payments over a period of time rather than funding the equipment upfront. 

This works well for businesses that are capital-intensive.

Equity funding is expensive funding. 

Equipment leasing reduces the amount of equity funding you need to raise. 


Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
-----
For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group

In this episode, Hall welcomes Olusegun Okubanjo, Managing Partner of Obsidian Capital.

Based in London, Obsidian Capital is a boutique investment banking firm that arranges infrastructure-oriented, transaction-based funding for mid-sized clients in West Central and East Africa. They are excited about Emerging Africa's economic potential and are committed to supporting private-sector led growth on the continent by providing onshore institutional clients access to the best global investment banking services.​ They create, incubate and invest directly in high-growth businesses in the region, and are less focused on specific sectors and more focused on investing in the right people - who have ambitious ideas, foresight and passion to change the world.

Olusegun has over 20 years of experience in wealth management and investment banking and is skilled in crafting and implementing sophisticated financial solutions to the uniquely complex personal and corporate investment structures that are typical of the entrepreneurial clients in emerging Africa.

Prior to joining OBSIDIAN, Olusegun was Executive Director, Africa at UBS, London. He began his career with ARM Investment Managers, Lagos and went on to head the West Africa offshore private client divisions at Standard Bank and Renaissance Capital and led a team covering West Africa at Barclays Wealth in London.

Olusegun has a BSc in Business Administration and an MBA in International Business from the Gardner School of Business & Technology, Wayne State College. He studied Law (Juris Doctor) at the University of Nebraska, Lincoln and is a member of the Chartered Institute for Securities & Investment, London.

Olusegun speaks with Hall about the state of investing in Africa, what excites him as an investor and what Obsidian Capital’s investment thesis is. 

You can visit Obsidian Capital at www.obsidian.capital. 

Olusegun can be contacted via LinkedIn at www.linkedin.com/in/segunokubanjo/, via Twitter at www.twitter.com/segunokubanjo and via email at ooo@obsidian.capital.