{"id":3654,"date":"2019-09-27T09:25:43","date_gmt":"2019-09-27T09:25:43","guid":{"rendered":"https:\/\/www.intrepidexecutivegroup.com\/blog\/?p=3654"},"modified":"2019-09-27T09:25:43","modified_gmt":"2019-09-27T09:25:43","slug":"how-does-equity-financing-work","status":"publish","type":"post","link":"https:\/\/www.intrepidexecutivegroup.com\/blog\/how-does-equity-financing-work\/","title":{"rendered":"How Does Equity Financing Work?"},"content":{"rendered":"<p>Equity financing has become an increasingly popular financing method for businesses. As the name suggests, it involves exchanging equity for capital. When compared to debt financing, it&#8217;s a more flexible financing solution with a lower barrier of difficulty. Whether you run a small, medium or large business, you should consider equity financing. To learn more about equity financing and how it works, keep reading.<\/p>\n<h2><span style=\"font-size: 18pt\">How Does Equity Financing Work?<\/span><\/h2>\n<h2><span style=\"font-size: 14pt\">The Basics of Equity Financing<br \/>\n<\/span><\/h2>\n<p><a href=\"https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2019\/08\/financing-2.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-medium wp-image-3597\" src=\"https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2019\/08\/financing-2-300x169.jpg\" alt=\"\" width=\"300\" height=\"169\" srcset=\"https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2019\/08\/financing-2-300x169.jpg 300w, https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2019\/08\/financing-2-768x432.jpg 768w, https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2019\/08\/financing-2-450x253.jpg 450w, https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2019\/08\/financing-2.jpg 960w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a>Equity financing is a fundraising method used by businesses that involves selling ownership (equity) to an investor or investment firm. If you own equity in your company &#8212; and assuming your company is valuable &#8212; you might be able to sell some of your shares. The investor or investment firm will purchase your shares in hopes that your company will continue to grow, resulting in higher-priced shares that the investor or investment firm can resell for a profit.<\/p>\n<h2><span style=\"font-size: 14pt\">Equity vs Debt Financing<br \/>\n<\/span><\/h2>\n<p>Debt financing, on the other hand, is a traditional business financing method that involves borrowing money or credit from a lender. Debt financing doesn&#8217;t require you to sell or otherwise forfeit ownership of your company. Rather, you simply borrow money or credit from a lender under the terms that you&#8217;ll repay it, typically with interest.<\/p>\n<h2><span style=\"font-size: 14pt\">Benefits of Equity Financing<br \/>\n<\/span><\/h2>\n<p><a href=\"https:\/\/www.intrepidexecutivegroup.com\"><img loading=\"lazy\" decoding=\"async\" class=\"alignleft wp-image-2649 \" src=\"https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2018\/04\/IEG-CTA-300x200.jpg\" alt=\"\" width=\"278\" height=\"185\" srcset=\"https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2018\/04\/IEG-CTA-300x200.jpg 300w, https:\/\/www.intrepidexecutivegroup.com\/blog\/wp-content\/uploads\/2018\/04\/IEG-CTA.jpg 360w\" sizes=\"auto, (max-width: 278px) 100vw, 278px\" \/><\/a>With equity financing, you don&#8217;t have to worry about repaying the money given to you by the investor or investment firm. Whether you raise $10,000 or $1 million through equity financing, you won&#8217;t be required to pay back a dime. All the money is yours to keep and do as you please.<\/p>\n<p>Additionally, you don&#8217;t need good credit &#8212; or any credit for that matter &#8212; to obtain equity financing. Equity investors don&#8217;t care about you or your business&#8217;s credit. Rather, they only care about the current value, as well as future value, of your business&#8217;s stock shares. If your business is poised to grow at a fast rate, equity investors will likely offer to purchase some or all of your business&#8217;s stock shares.<\/p>\n<h2><span style=\"font-size: 14pt\">In Conclusion<br \/>\n<\/span><\/h2>\n<p>Equity financing is just one of many ways to finance a business. When compared to debt financing and other traditional methods, it offers several unique advantages. Among other things, equity financing is fast, doesn&#8217;t require good credit, and you aren&#8217;t required to repay it.<\/p>\n<p><strong>This article was brought to you by\ufffd<a href=\"https:\/\/www.intrepidexecutivegroup.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Intrepid Private Capital\ufffdGroup<\/a>\ufffd\ufffd A Global Financial Services Company. For more information on startup and business funding, or to complete a funding application, please visit our\ufffd<a href=\"https:\/\/www.intrepidexecutivegroup.com\/\">website<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Equity financing has become an increasingly popular financing method for businesses. As the name suggests, it involves exchanging equity for capital. When compared to debt <a href=\"https:\/\/www.intrepidexecutivegroup.com\/blog\/how-does-equity-financing-work\/\" class=\"read-more-link\">[Read More&#8230;]<\/a><\/p>\n","protected":false},"author":2,"featured_media":3655,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[97,26,437,96,178,223,185,127,396],"class_list":["post-3654","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","tag-business","tag-business-capital","tag-business-funding","tag-capital","tag-company","tag-entrepreneur","tag-finance","tag-financial","tag-financial-services"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How Does Equity Financing Work? - Intrepid Private Capital Group Financial News Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.intrepidexecutivegroup.com\/blog\/how-does-equity-financing-work\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How Does Equity Financing Work? - Intrepid Private Capital Group Financial News Blog\" \/>\n<meta property=\"og:description\" content=\"Equity financing has become an increasingly popular financing method for businesses. 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