An overview of the potential benefits offered to your business from equity finance.
Equity investors take a risk acquiring shares. In exchange, they can see an uplift in the value of their stake if the business performs well. This is a result of the deployment of additional capital.
Advantages of equity finance
- One of the key advantages of equity finance is that funding is committed to the business and its intended projects, even if plans change.
- Investors naturally want the business to do well, so their investment increases in value. Therefore they share in your pursuit of growth and success.
- As well as taking a stake in the business, the right angels, venture capital investors or any other equity investor can bring valuable resources to the business. Their skills, experience and contacts can help with the development of the business strategy.
- If it is a private company, the business owner can sell their stake privately to a willing private buyer. Or, if the business is to be listed, they can sell their shares through flotation.
- Investors are often prepared to provide follow-up funding as the business grows.
- Public equity raising provides a liquid market, which can be accessed if further fundraising is required for future growth plans.
- Equity crowdfunding provides a company with wider access to capital providers among customers and the public.
- If you choose a crowdfunding option, the crowdfunding process can be relatively quick.
Explore the various equity options available to you.
Many forms of equity finance are supported by an industry body that has been involved in creating the Business Finance Guide. See the Business Finance Guide partners.
Finance at every stage
Business financing is not a one-off decision, but an ongoing and evolving situation. No decision can be made in isolation to the businesses journey. Find out more about what options are suitable now and what might work at another stage.
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