What is the simplest form of external funding?

• A. Issuing stock
• B. Secured bank loan
• C. Brokering a lease transaction to a funding source on a one-off basis
• D. Government grant

Answer: (C)

The key idea is that the simplest way to obtain external funding in this context is to act as an intermediary and broker a lease transaction to a funding source on a one-off basis. This keeps the process lightweight: you don’t put up capital, you don’t take on the borrower’s credit risk, and you don’t enter into long-term debt or equity relationships. The funding comes from a third-party lender or funder, and you earn a fee for arranging the deal. It’s faster and less complex than issuing stock, which involves equity dilution and regulatory steps; or securing a bank loan, which requires underwriting, collateral, and covenants; or pursuing a government grant, which often involves strict eligibility, lengthy applications, and ongoing compliance. So, brokering a one-off lease to a funding source embodies a straightforward way to connect funds to a deal without the heavier commitments of other external financing options.