Raising Capital 101
A private or public company can raise capital in a variety of ways. Traditional sources of capital for companies include loans from financial institutions such as a bank, or from friends and family as well as receivable financing. Companies raising capital in going public transactions often do so by selling their securities prior to filing an SEC registration. Going public is a milestone for any company and there are both advantages and disadvantages that attach to public company status. Many Companies going public do so because of the general perception that their new status will make raising capital much easier. Public companies can offer investors an exit strategy for their investment.