Equity financing provides the entrepreneur with maximum flexibility: Dividends are not required and can be made when cash flow is strong enough to meet all obligations of the firm. Entrepreneurial financing is concerned with understanding the funding requirements for a new business and what sources of funds are available.

Debt financing restricts financial flexibility but can be cheaper under some circumstances. Financing is not a one-size-fits-all procedure

accounting — system of recording and classifying a company’s financial transactions and summarizing and communicating those transactions in the form of financial statements. equity financing — funds provided in exchange for a share of ownership in a business. financing — raising money to fund the startup and operation of a business. debt financing — borrowing funds that must be repaid, usually with interest.