Equity Financing

Often times it can be difficult for start-up companies to obtain adequate funding. Since debt financing is usually not an option, many companies rely on share capital, also known as equity financing.

Equity financing provides funding through the sale of common or preferred stock to individual or institutional investors. Equity capital is often raised from Angel Investors or Venture Capitalists, however publicly traded companies can instead offer stock on the open market. This is common practice for many organizations, but especially for those traded on the Pink Sheets and the Over the Counter  Bulletin Board (OTCBB).

The downside of equity financing, is that the majority owners lose some control over the company. Therefore, it is important to raise the required capital when share price is at it’s highest. Minimizing dilution is important in order to protect all investors.

If your company is considering equity financing, an investor awareness campaign is essential. By increasing visibility, your company stock will undergo a marked increase in both liquidity and share price. The cost of such promotion is minimal in comparison to the capital raised.

Please contact us if you are interested in learning more.

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Investor Relations for Emerging Companies

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