Limits on interest rates. Interest rates can either be fixed or variable. Where they are variable, it may be agreed (at a cost) that the rate is capped so it will not rise above a certain figure, or that there will be a floor below which it will not fall. A collar involves both a cap and a floor.

Abbreviation for "carried interest scheme" - an investment vehicle used by many venture capital companies to allow their employees to co-invest in companies on favorable terms.

Just what it says, referring to a business which has a strong positive cash flow.

Investing in a growing enterprise is always risky, but you can increase the "comfort factor" by checking up on various aspects of the business - the state of relationships with its customers, for instance, or whether its products are highly rated by reputable authorities. Comfort factors can often by provided by due diligence.

The moment when legal documents are signed. Normally, also the moment at which funds are advanced by investors.

Regulation of the UK's financial services industry has developed almost out of recognition. "Compliance" is the process in thousands of offices in the City and around the country to ensure that these regulations are complied with. Many of the rules are designed to protect the public from misleading claims about returns they could receive from investments, others outlaw insider trading.

Before a deal is completed, an investor in a business venture may insist on certain conditions being satisfied. See also comfort factor.

See back to basics.