In a span of less than four months, Tesla Motors founder and CEO Elon Musk has added $2.3 billion to his personal wealth. Musk is now worth more than $13 billion, according to the Bloomberg Billionaire Index, but it could have worked out very differently. In fact, a crucial decision Elon Musk was forced to make in 2010 when, by his own account, the billionaire was broke, is one of the reasons Musk has been able to cash in on Tesla's rapid share rise this year: Musk held on to shares at the very moment when a sale to raise cash would have made financial sense. Musk, who had $200 million in cash at one point, invested "his last cent in his businesses" and said in a 2010 divorce proceeding, "About four months ago, I ran out of cash." Musk told the New York Times' DealBook at that time, "I could have either done a rushed private stock sale or borrowed money from friends." It's a dilemma that many entrepreneurs face, but there is a big difference between the options available to Musk and the options available to most business owners. Musk was able to live on $200,000 a month in loans from billionaire friends — while still flying in a private jet — rather than sell any of his Tesla stake. Though the root of the problem is the same: intangible assets or, in other words, a business owner who is "asset rich" and "cash poor." And it can lead business owners to the most difficult decision of all: having to sell a piece or even all of their company.

This is not a problem limited to founders of technology start-ups based in California. "It's really one of those tough scenarios with no good answers," said Richard Stumpf, CFP and managing partner of Wichita, Kansas-based Financial Benefits. Stumpf has worked with farmers in this situation, and sometimes for reasons that are similar to what drove Musk to admit he was broke: divorce. "It happens all the time here," he said. "Farming 2,000 acres ... asset-rich, cash-poor. And the options are limited, quite frankly." Even if you have friends as nice as Elon's, borrowing money can cause problems. Years ago a friend of Stumpf's, who owned a heavy road construction company, got into a bind and borrowed money from buddies. He eventually paid them back, but got behind and risked ruining relationships. In the end the business survived better than his strained friendships. Even for business owners with collateral to back the loan, the cash flow needs to be coming in to meet debt payments. And in many cases lenders are picky about asset types they will accept. Intangible assets are not the type of collateral that a typical commercial lender will accept, said Andrew Sherman, partner at Seyfarth Shaw, who has worked with companies at all stages of development. "The bank is in the business of collecting interest, not foreclosing on collateral," Stumpf said. "Selling the business or some of the ground that you don't want to sell can be the only way to survive," he said. This can be a good problem for business owners who have contracts lined up that will create significant cash flow but for which expansion is first needed. But selling equity to fund expansion is often a dreaded decision — and for good reason. "You don't want to go the way of angel investors, because you know you're giving away a whole lot more than you're getting," Stumpf said. "In a fast-growing business, you sell 10 percent for cash to make it continue to grow, but when you're growing 30 percent to 40 percent a year, that's a heck of a return on capital" being given to someone else. "It's a shame when that happens with a viable business," Stumpf added.

In a fast-growing business, you sell 10 percent for cash to make it continue to grow, but when you're growing 30 percent to 40 percent a year, that's a heck of a return on capital. It's a shame when that happens with a viable business. Richard Stumpf managing partner of Financial Benefits