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The Difference between Debt and Equity

When you start a company you would need money to help grow. There are lots of different ways to do that but debt and equity are the most common. With debt you would go top the bank and ask for money and then you would have to repay the bank. But if your business doesn't make enough money to repay the bank the bank can take your whole business away. If you choose equity you would get investors to invest in the company meaning that the company would be split into lots of different owners. If you don't control more than 51% the company can kick whoever is in charge out if everyone chooses that. in equity you don't have full control and the full income of the company and in debt you would pay the interest of the total.



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