Topic 10 - Raising Capital hshshhshs.pptx

all about raising capital

1. Magan, Rizah C. Montemayor, Charlene L. RAISING CAPITAL

2. 01 What is capital? Table of contents 02 Types of Capital 03 04 Ways of Raising Capital Raise Capital 05 Pros and Cons in Raising Capital

3. 01 What is capital?

4. 01 What is capital? A capital is used to finance the startup costs of a business, including the cost of renting office space, hiring employees, and purchasing equipment. Capital refers to the financial resources that a business can bring to bear in order to generate profits.

5. 02 Types of Capital

6. 02 Types of Capital Financial Capital Economic Capital Constructed or Manufactured C apital Human Capital Social Capital Intellectual Capital Cultural Capital Experiential Capital Natural Capital

7. Financial Capital Economic Capital Financial capital, which is also referred to as investment capital, is the financial assets or economic resources a business or organization needs to provide goods or services and generate future revenue. Economic capital is the amount of money that a company needs to ensure its stability, given the number of its assets and liabilities.

8. Constructed or Manufactured Capital Human Capital Constructed, or manufactured, capital refers to the human-made stock of material objects, systems, infrastructure and processes that turn materials into products. Human capital is the collection of resources that individuals or groups within a society possess that contribute to economic activity, increase productivity and enhance the overall quality of life.

9. Social Capital Social capital is resources gained through interpersonal relationships and larger social networks. Social capital falls into two categories: • Bonding social capital • Bridging social capital

10. Intellectual Capital Intellectual capital is the information, competency, knowledge and expertise a person has. It’s developed through education, training and hands-on experience. The perceived worth of your intellectual capital depends on how your specific knowledge base adds value and provides advantages within a certain context.

11. Cultural Capital Cultural capital is the collection of material goods, experiences and social assets you attain throughout your life Experiential Capital Experiential capital is the knowledge you gain through a variety of firsthand experiences over the course of your life.

12. Natural Capital Natural capital refers to the Earth’s naturally occurring resources that are necessary to sustain life. This type of capital includes the environmental goods that provide the basic conditions for human survival, such as food, water, oxygen and other essential resources.

13. Raise Capital 03

14. 03 Raise Capital Capital raising definition refers to a process through which a company raises funds from external sources to achieve its strategic goals, such as investment in its own business development, or investment in other assets.

15. Ways of Raising Capital 04

16. 9 WAYS OF RAISING CAPITAL Crowdfunding. Crowdfunding is a popular option for entrepreneurs who want to raise capital without giving up control of their company. Bootstrapping. Bootstrapping is a term used to describe the process of starting and growing a business with little or no external funding. Venture Debt. Venture debt is a type of financing that allows companies to borrow money without giving up equity.

17. 9 WAYS OF RAISING CAPITAL Convertible Notes. Convertible notes are a form of debt that can later be converted into equity. They allow companies to raise capital without giving up equity upfront. Grants. Some government entities and non-profit organizations offer interest-free grants for certain companies. Utilize Share Classes . Companies can issue multiple classes of stock, with each class having different rights and privileges.

18. 9 WAYS OF RAISING CAPITAL Shareholder Agreements. A shareholder agreement is a contract between the company and its shareholders that outlines the rights and obligations of each party. Maintain a Majority Stake. If you own more than 50% of the company, you may have control over major decisions, including approving significant investments. Board Composition. B oard composition is an essential factor to consider when raising capital and retaining control over a company.

19. Pros and Cons in Raising Capital 05