Is selling shares the best way to raise capital?
If your small business is looking at raising funds, selling shares may be a viable option for you. Selling shares is also often used as a solution to reducing debt, as shares can be sold in place of taking on debt from various loans and other financing options.
How do shares raise capital?
Ordinary shares are issued to raise capital and are considered to be permanent funding, which means that they cannot be repaid under normal circumstances. However, a company can purchase its own shares to redeem them, either privately or in the market to keep the control of the company with it's existing shareholders.
What are the benefits of selling shares?
Selling shares in a business can generate significant cash, which can pay down debts or be used for investments or charitable donations. That cash can also go back into the business, where it can fund expansion.
Can raise additional capital through the sale of stock?
A company can raise capital by selling off ownership stakes in the form of shares to investors who become stockholders. This is known as equity funding. Private corporations can raise capital by offering equity stakes to family and friends or by going public through an initial public offering (IPO).
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[PDF] RAISING CAPITAL: SECURITIES LAW AND BUSINESS - MNgov
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[PDF] Looking to raise capital? Don't forget the accounting! - Deloitte
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[PDF] Raising-Capital-for-the-Emerging-Businesspdf - Sheehan Phinney
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