Love Money

AAA

DEFINITION of 'Love Money'

Seed money or capital given by family or friends to an entrepreneur to start a business. The decision to lend money and the terms of the agreement are usually based on qualitative factors and the relationship between the two parties, rather than on a formulaic risk analysis.

INVESTOPEDIA EXPLAINS 'Love Money'

Love money is usually given to entrepreneurs who have proved their responsibility to close family and friends over the years, but who fail to meet the capital requirements that financial institutions look for in borrowers. An angel investor's love money is sometimes the only way a business can get off the ground; this type of financing can allow for growth that would be impossible through traditional financing channels.

RELATED TERMS
  1. Crown Loan

    A loan with no set maturity date, These loans are typically made ...
  2. Startup Capital

    Startup capital refers to the money that is required to start ...
  3. Venture Capital

    Money provided by investors to startup firms and small businesses ...
  4. Mom And Pop

    A colloquial term for a small, independent, family-owned business. ...
  5. Angel Investor

    An investor who provides financial backing for small startups ...
  6. Venture Capitalist

    An investor who either provides capital to startup ventures or ...
Related Articles
  1. Investing Basics

    6 Terms To Warm The Coldest Wall Street Heart

    There is plenty of love on Wall Street, even if it's all just words.
  2. Retirement

    IPO Basics Tutorial

    What's an IPO, and how did everybody get so rich off them during the dotcom boom? We give you the scoop.
  3. Entrepreneurship

    How can I become a venture capitalist?

    Find out what it takes to become a venture capitalist, and read about some of the primary attributes private equity firms look for in a potential hire.
  4. Entrepreneurship

    How is venture capital regulated by the government?

    Learn about some of the ways in which the U.S. government and the Securities and Exchange Commission regulate venture capital.
  5. Entrepreneurship

    How do ridesharing companies like Uber make money?

    Discover the services a transportation company such as Uber provides and how the premiere ridesharing company operates and makes money.
  6. Entrepreneurship

    How Steve Jobs Changed The World

    As an innovator and visionary, Steve Jobs’s accomplishments can be held on a pedestal with the likes of Microsoft’s Bill Gates, Google’s Larry Page and Sergey Brin and Facebook’s Mark Zuckerberg.
  7. Investing

    A Look at the 5 Richest People in the World

    Who are the five richest people in the world and how did they manage that feat?
  8. Professionals

    Understanding Interpersonal Skills

    Interpersonal skills are the social skills people use to interact effectively with other people. A lack of good interpersonal skills may lead to unsuccessful personal relationships, as well as ...
  9. Investing News

    The 5 Wealthiest People in Mexico

    Most people in the know have heard of Carlos Slim and his massive fortune. But what about Mexico's other richest people?
  10. Entrepreneurship

    The Most Successful App Companies

    The rapidly expanding mobile-app industry is worth billions of dollars. Its growth has led to huge success for some firms and very little for many more.

You May Also Like

Hot Definitions
  1. Multiplier Effect

    The expansion of a country's money supply that results from banks being able to lend. The size of the multiplier effect depends ...
  2. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  3. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  4. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  5. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  6. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
Trading Center