Companies may require additional capital to cover operational costs, expansions, or any other business activity they want to engage in. Borrowing from lending institutions can be hectic, so some companies opt to advance either through equity offerings or debt offerings. In both these arrangements, a company is getting money, but the payment terms are different. In this article, we’ve discussed equity offerings and debt offerings, highlighting the important aspects of the two and how they differ from each other.
Starting a business can be very expensive. Most entrepreneurs will try and look for investors to fund their idea. Some might not know that an investor will never invest in a venture that does not show promise of future success. That is why you should be able to convince them that your idea will be profitable. How do you do this? For one, your idea should be unique, and you should have records of past or projected financial performance. You should also show that you can grow the business to new heights regardless of the environment the business will be operating in. This article is best suited for an entrepreneur who wants to market their idea to potential investors. Read on for more insight on what investors want to know.
When you hear "purchasing a security," you automatically think of public offerings (this is where people purchase stocks of a publicly held company). Yes, publicly-traded stocks are securities, but they are not the only securities available. The word security has a broad meaning. It encompasses, among a host of other investment vehicles and instruments, stocks, treasury stock, notes, debentures, interests in oil and gas wells, and mineral rights, among others.
But how do you know whether something is a security under the Securities Act? The answer is pretty simple, the Howey Test. The Howey test is used to determine, using three elements, whether a product meets the definition of "Security" under federal securities laws. Read on for more insight on this issue.
In the investor realm, there are institutional investors and non-institutional investors. Even though both investors are just that, the business relationships between the two do not follow the same structure. This is due to the nature of the differentiating securities [investment] laws. If you’re a business seeking investment capital, it is important to note institutional