What is equity finance?
Popularised by hit television show ‘Dragons’ Den’, equity finance involves a private equity company provides capital investment, or seed capital, in return for a share of the business’ equity, often assuming an element of control over the business.
Equity finance is available through a range of solutions, depending on the size and funding requirements of your business. Whilst business angel investment is typically provided for fledgling businesses, venture capital companies provide equity capital to firms seeking an investment of more than £2million.
Equity finance is generally a medium to long-term method of raising business finance and can be hugely beneficial to a business’ cash flow, provided they find the right business angel or venture capital company willing to meet their requirements.
What are the benefits of equity finance?
- Unlike a business loan, which is repaid on a monthly basis, private equity companies earn dividend payments, ensuring their commitment and dedication to boosting your company’s success.
- Private equity investors provide expert advice and business support to help run the business, in addition to releasing seed capital.
- How much control the business angels or venture capital companies have depends on the terms of the contract agreed in advance. As a rule of thumb, the more they invest the higher the share an investor will expect.
- Turnaround capital additionally provides equity finance to boost the company’s cash flow.
Which equity finance solution suits my business?
There is a range of equity finance solutions for companies to choose from. To help you select the best fit for your business, call our award-winning team on 0800 9774833 or email firstname.lastname@example.org.
Business angels provide new business funding to help fledgling and growing businesses get off their feet. Business angel investment therefore supplies private equity to companies seeking up to £2million of seed capital to boost the business’ cash flow.
Venture capital companies invest private equity to firms seeking a minimum of £2million, whilst further providing valuable insight and business support to make it easier to source other funding solutions.
Growth capital provides capital investment in return for a share of the business to specifically help your company to expand, supplying additional capital to fund any mergers, acquisitions, management buy-outs and management buy-ins.
Turnaround capital supplies equity finance to help a business to overcome cash flow problems that are threatening its immediate financial security. The venture capitalist additionally provides support and financial management to assist the company going forward.
As the UK’s leading commercial finance broker, Hilton-Baird Financial Solutions will assess your business’ individual funding requirements and identify the most suitable methods of raising working capital.
Call us on 0800 9774833 or email email@example.com to find out more about the advantages of equity finance, or get an instant commercial finance quote.
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