Undercapitalized

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Undercapitalized

A business has insufficient capital to carry out its normal functions.

Undercapitalized

Describing a company that has insufficient capital to maintain operations without outside assistance. Undercapitalized companies often rely on short-term loans for funding, though they may issue stock or bonds at some point to raise capital.

undercapitalized

Of, relating to, or being a firm that has insufficient long-term equity to support its assets. A rapidly growing company that finds itself financing its operations primarily with short-term loans may be undercapitalized.
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Based on the results of investment efficiency variable which represents the investment efficiency of sample companies; includes the negative and positive figures that based on our model of research, positive figures represent over-capitalization and negative figures represent undercapitalization.
The microfinance situation in Burma is fragile owing to undercapitalization of MFIs, legal questions surrounding interest rates, broad macroeconomic instability, rising inflation, and little savings mobilization among MFI borrowers.
Bonding, funding, [and] undercapitalization have been the death knell for black businesses," says Stephen Davis, president of The Will Group and the current chair of ABLE.
The real concern right now is Europe, the weakness in some of the banks in Europe, the fact they're undercapitalized, the fact the other European countries in the eurozone have not taken sufficient action yet to address those issues of undercapitalization of the banks and building an adequate firewall," he said.
They eventually led to an undesirable condition of undercapitalization of large banks in a number of countries," Salameh said.
Washington ultimately believed that finances were the basis of true equality and that blacks were handicapped by undercapitalization.
Undercapitalization is a principal contributing factor to early restaurant failures as it often takes customers a while to patronize a new venue for the first time.
An often mentioned cause of small business failures is poor management, particularly poor financial planning and undercapitalization.
The BSL, however, was hindered by undercapitalization and a lack of expertise in managing a shipping company.
The $955 million Town North Bank reached the brink of undercapitalization when it sold its card processing business to Fifth Third Processing Solutions on July 6 for an undisclosed price.
While there are many reasons for small business failures, including lack of experience, failure to properly price goods and services, and inadequate record keeping, one of the most common is undercapitalization (Case, 1996; Gross, 1993).
For many of these taxpayers, application of the SSCM resulted in a significant undercapitalization of costs allocable to self-constructed assets.