Intro to Business › Section P · Financial management and securities markets › Topic P.5
Equity financing
Equity is the owners' stake in a business. It never has to be repaid, which makes it the most patient money a firm can raise, but each new share hands someone else a slice of the control and of every future profit.
In this topic
- Three routes to equity
- Common stock and going public
- The costs of going public
- Worked example: IPO proceeds and dilution
- Dividends
- Retained earnings
- Worked example: dividends and the payout ratio
- Preferred stock
- Venture capital and angels
- Common mistakes to avoid
- Key takeaways
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