Debt Financing
When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise that the principal and interest on the debt will be repaid. Investopedia Says:
The other way of raising capital is to issue shares of stock in a public offering. This is called equity financing. Related Terms:
Bond
Capital Structure
Commercial Loan
Creditor
Delayed Draw Term Loan
Deleverage
Dividend Recapitalization
Equity Financing
Pre-Money Valuation
Refinancing Risk |