Suppose you were given an opportunity to own a business of your choosing. First, briefly describe your business; then explain the most efficient way to raise capital to either start or expand your business. Provide support for your response.
Determine at least two (2) key advantages of equity financing compared to debt financing options. Provide a rationale for your response.
The main advantage to equity financing is that the business is not obligated to repay the money. Instead, the investors hope to reclaim their investment out of future profits. The involvement of high-profile investors may also help increase the credibility of a new business.excessive reliance on equity financing may indicate that a business is not using its capital in the most productive manner.