Financial capital refers to the funds that businesses and individuals use to invest in projects, purchase assets, or cover operational costs. It can come from various sources, such as personal savings, loans from banks, or investments from venture capitalists. Essentially, financial capital is the money that helps drive economic activities and growth.
In a broader sense, financial capital is crucial for the success of any enterprise. For example, a startup may rely on angel investors to secure the necessary financial capital to develop its product and enter the market. Without adequate financial capital, even the best ideas may struggle to become successful businesses.