Financing by selling common stock or preferred stock to investors.
Selling an interest in your business to an outside party to raise money. Equity financing does not have to be repaid like a loan. Investors participate in the company's profits and/or its appreciation in value based on their level of ownership. Equity financing often involves giving the outside party some level of control over business operations. [go back to glossary list
mode of financing in which financiers provide funds in return for partial ownership of a company (equity), and expect profit or return on their equity. In contrast to debt financing.
involves issuing stock or shares (equities) that will normally pay dividend but need never be repaid.
Any form or financing based on the equity of the business.
is a method of an entity obtaining funds by issuing either common or preferred stock, or both. Receipts can be through cash, services, or property. It is in the entities best interest to issue shares when the market price for the stock is at its highest.
This involves "selling" a portion of your company to an outside investor. You have no obligation to repay the funds. In general, venture capital firms provide this type of funding.
Raising money for working capital or for capital expenditures by selling common or preferred stock to individual or institutional investors. In return for the money paid, the individuals or institutions receive ownership interests in the corporation.
Raising money by the sale of stock.
this involves selling a portion of your company in order to receive funds. In general, venture capital firms such as "angels" provide this type of financing.
Raising money by issuing of shares of common or preferred stock (Also see Initial Public Offering and Private Placement)
Obtaining funds by issuing stock. (Compare Debt financing.) View LEI Lesson(s) that address this term
Lender finances high-ratio loan in exchange for a percentage of an ownership and the right to share in the property's cash flow.
When a small business owner or another investor finances a company.
This is the portion of the company that the owners give up in exchange for funding. (example: an angel investor might be willing to invest in a startup company for a 20% interest on the company or your uncle might be willing to give you $10,000 in exchange for half of your company).
The sale of stock in order to raise money in exchange for the buyers receipt of an interest in the entity.
The securing of a monetary investment from an investor in which the investor becomes a part owner of the business.
selling a part of your ownership therefore relinquishing some control.
Selling partial ownership in the business to raise capital.
A corporation's issuance of shares of common or preferred stock to raise money. Equity financing is commonly done when its per share prices are high--the most money that can be raised for the smallest number of shares. See: Equity
When stock (common or preferred) is sold to individuals or institutions and, in return for the money paid, the individuals or institutions receive ownership interest in the corporation.
The provision of funds for capital or operating expenses in exchange for capital stock, stock purchase warrants and options in the business financed, without any guaranteed return, but with the opportunity to share in the company's profits. Equity financi
Selling an interest in the business to an outside party or investor to raise money. Sometimes referred to as an Equity Offering, because the business owners are raising funds by offering ownership in a corporation through the issuing of shares of a corporation's common or preferred stock.
Normally refers to sales of securities with the net proceeds contributed to the company as paid in capital.
A method of raising capital in which a corporation sells shares of stock.
Capital secured in exchange for an ownership interest in the company.
The sale of securities representing ownership in a corporation for the purpose of raising capital.
Financing by selling ownership interests to investors.
is an asset-based loan and form of debt financing whereby preferred stock or common stock is issued to investors. Equity of company is issued to secure financing or capital to maintain business operations. Venture capital is an example of equity financers.
A method of financing where a company issues shares of its stock and receives money.
