Definition:
An initial investment is the money a business owner needs to start up a firm. It may include the business owner's own money, money borrowed from a variety of sources including family and friends or banks, or money raised from investors.
The term initial investment is also used as the money a business owner uses to invest in a capital investment project such as a piece of equipment or a building.
Also Known As: Owner's Capital; Owner's Equity
Examples:
Sam's initial investment to start up XYZ, Inc. was $20,000 for plant and equipment.
