Equity financing is defined as the act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. This is an alternate way of raising fund. The other way to raise money is through debt financing, which is when the company borrows money.

IPDC has been the pioneer in equity finance in Bangladesh . IPDC has made significant impact in country's financial market by making equity finances in land mark projects like IDLC, National Housing and Finance company etc. In 1998 IPDC again made another ground-breaking finance by investing in to the first Cumulative Redeemable Preference shares of Holcim Bangladesh .

 

• It enables management to focus on business, not cash flow. Cash can be saved for uses in business operation rather than making periodical loan repayments
• No fixed repayment/exit date until or unless tentatively mentioned in the agreement
• Improves negotiation position with the lenders as the opportunity for financial leverage opens up
• Equity financing is generally unsecured and collateral is not required by the financier
• Relationship with industry experts/customers through the assistance of the investment banker

IPDC offers the following two types of equity financing to the entrepreneurs:

• Common Equity Finance
• Quasi Equity Finance