Question

Discuss one pro and one con for funding your company through equity from the point of view of the firm. (4-6 sentences)

Answer 1

One pro and one con of funding your company by equity is as follows :->

Pro

1. You dont have to bear all the risk. All the shareholders including investors share the risk and you dont have to payback the money to investors in case of losses

Con

1. There is lack of freedom in the sense of decision making power. Approval of the investors have to be taken before any strategic movement.

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