This training course is designed to complement the “Introduction to Finance Documents” module by offering a strategic comparison of debt and equity financing options available to UK businesses. Aimed at business owners, investors, finance directors, and in-house lawyers, the session explores the legal structures, commercial implications, and long-term consequences of different funding routes. Participants will explore:
Core differences between debt and equity: Legal obligations, ownership dilution, repayment expectations, control considerations, and risk profiles
Legal structures and documentation:
• Loan and security documentation for debt
• Shareholder/investment agreements, subscription terms, and articles of association for equity
Types of financing instruments:
• Convertible loan notes, preference shares, venture debt, mezzanine financing, and crowdfunding
Investor protections vs. lender protections: Board rights, veto rights, financial covenants, default provisions, enforcement routes
Commercial implications: Cost of capital, tax deductibility, impact on company valuation, exit planning, and gearing ratios
Key factors to consider when choosing a funding route: business stage, risk appetite, growth ambitions, cashflow position, and investor expectations
Case studies of common scenarios and lessons learned from real funding structures
How to approach negotiations with funders and investors – balancing control, flexibility, and long-term alignment
This session equips attendees with a clear understanding of the pros and cons of each route, helping them choose and structure funding that supports the strategic goals of their business.
