When do startups use a bill of exchange?

Startups may use bills of exchange when they are seeking funding from investors.

Bills of exchange can be a helpful way for startups to get funding without giving up equity in their company. Instead of selling shares in the company, the startup can simply sell one to an investor. It would be payable by the investor, and the startup would receive the funds it needs to continue operating.

It can also be used by startups to pay suppliers and vendors. In this case, it would be drawn up by the startup and would be payable by the supplier or vendor.