Equity Financing Explained

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Equity Financing

What is Equity Financing?

Equity financing is the process of raising capital by selling shares of the business.

Explanation

Equity financing involves:

Angel investors
Venture capitalists
Public stock offerings

It can fuel significant growth but dilutes the original ownership stake. Unlike debt, there are no repayments, but investors may expect influence over business decisions.

Practical Example of Equity Financing

A tech startup sells 20% ownership for £500,000 in funding from private investors.

How Bizcap Can Help:
Prefer to keep 100% ownership? Bizcap’s lending solutions allow businesses to grow through borrowing instead of giving up equity.

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