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The process or means of acquiring capital necessary to conduct a business activity. Two of the most common forms of financing are debt financing and equity financing. In debt financing, one borrows money, usually from an institution, with the promise to return the money with interest at some point in the future. This provides capital to the borrower and a profit to the lender. In equity financing, a company sells portions of ownership to those who are interested. Unlike debt financing, equity financing usually raises capital without incurring liabilities, but the risk exists that the company will not raise enough. An alternative to both debt financing and equity financing, especially for start-ups, is using money from personal savings to pay for activities.


Borrowing money to buy property. See leverage.

References in periodicals archive ?
SCO Securities LLC, an affiliate of SmallCaps Online Group LLC, assisted BMRN in financing activity within the past 12 months.
This figure more than doubles our January financing total and confirms NCB's prediction of a resurgence of financing activity for New York coops in the coming months.
9 million increase in profit from financing activity before the provision for doubtful debts, a decrease of $11.
Fitch developed the new peer categories in response to the growth in financing activity at the parent company level.
First half figures this year show new permanent employment of 1,175 jobs estimated to be created and nearly 4,300 construction jobs attributed to the agency's overall financing activity.
However, our experience in this line of business compels us to conclude that this form of financing activity is more appropriately conducted via a fund-type structure which focuses on IRR hurdles rather than ROE hurdles.