Scott Herckis is a Stamford, Connecticut resident with over 25 years of experience in accounting and finance. Scott Herckis serves as CEO of SJH Financial, LLC in Stamford, Connecticut, where, among other things, he helps his clients raise capital for their businesses.

Raising capital, whether to start a business, expand an already established business, or use for other business purposes, can be pretty challenging and mean the difference between failure and success of a venture. Therefore, business owners and corporations must learn how to raise capital and the options available to them.

One common way a company can raise capital is through debt financing (borrowing from lending institutions with an agreement to pay later). Corporations can borrow loans from banks, friends and family, and private lenders.

Business owners can also raise capital through equity financing, which involves selling shares of the company stock. One key advantage of using this approach to raise capital is that the firm is not compelled to return the shareholder’s investment. Instead, when the firm makes a profit, it issues dividends to investors.