Finance and Valuation, Essay Example

Introduction

The business that I see myself owning is a clothing company which will make all types of clothes that target both men and women consumers in the market. My desire is to own such a business is vested on my interest on fashion and design. I have always believed that a clothing company is one of the lucrative businesses in the market since clothing is one of the basic human needs. Drawing a pool of research, I have discovered that clothing business is one of the businesses that will never die so long as the humankind perpetuates its existence.

The most efficient way to raise capital for the start and expand the business is through equity funding. The rationale behind equity capital is that it is easy and very cheap to acquire. As an entrepreneur I will need to attract interested investors to buy shares from the company and thus be able to raise the required capital. Unlike loans, equity capital does not attract interest rates and property of the company cannot be confiscated by anybody. Equity capital enables an entrepreneur to acquire more resources that are important for the growth and expansion of a business.

Raising capital in foreign markets enables a company to enjoy the following benefits, reduce cost of capital acquisition due to the difference between domestic and home currency. Raising capital in foreign markets enables a business to attract more shareholders, for instance international companies such as Coca Cola have more shareholders in foreign countries than in the USA. Some governments also give incentives and tax exemptions to international companies to encourage foreign investments in the country.