01/ Debt Investment

Companies raise capital through debt financing. With this form of financing, enterprises must first bear interest on the acquired funds and repay the principal to creditors upon loan maturity. The characteristics of debt financing determine that its primary purpose is to address enterprises’ working capital shortfalls rather than fund capital expenditures. Debt financing is mainly categorized by channel into bank credit, private lending, bond financing, trust financing, project financing, commercial credit, and financial leasing.

02/ Equity Investment

This refers to a financing method where original shareholders of a company grant a portion of their ownership to new shareholders, granting them corresponding ownership rights in the enterprise through a capital increase. Companies are not required to repay principal or interest on funds obtained through equity financing; however, both new and existing shareholders share impartially in the company’s profits according to their respective ownership proportions. Capital raised through equity financing can be used not only to strengthen the company’s working capital but also for its investment activities.