A capital raise is the process by which a company seeks to obtain additional funds or capital from investors to finance its operations, growth, or other business needs. This can be done through various methods, including:
- Equity Financing: Selling shares of the company to investors in exchange for capital. This can include initial public offerings (IPOs) for publicly traded companies, or private placements for privately held companies.
- Debt Financing: Borrowing money from lenders or issuing bonds, which must be repaid with interest.
- Convertible Debt: A hybrid form of financing where the debt can be converted into equity at a later date under certain conditions.
- Crowdfunding: Raising small amounts of capital from a large number of investors, often through online platforms.
- Venture Capital or Private Equity: Seeking investment from venture capital firms or private equity investors, often in exchange for a significant equity stake in the company.
Capital raises are crucial for companies looking to expand, develop new products, enter new markets, or strengthen their financial position.
