Should Your Company Have Debt?

Image credit:frankieleon | Flickr People refer to debt as leverage, because at a certain level of earnings, debt will increase the return on equity (ROE). The reason: There are only two ways to capitalize a business, debt and equity. Related: How to Make Debt Work For You Let’s say that a business needs $1 million of capital …

SunEdison Files for Chapter 11 Bankruptcy Protection

Image credit:Reuters | Noah Berger U.S. solar energy company SunEdison Inc. filed for Chapter 11 bankruptcy protection on Thursday, becoming one of the largest non-financial companies to do so in the past 10 years. Once the fastest-growing U.S. renewable energy developer, SunEdison embarked on an aggressive acquisition strategy that left it struggling with $12 billion in …

You Can Launch Your Startup Despite Huge Student Loan Debts

Image credit:Shutterstock As recently as 2012, a major study concluded that 1.3 million students will graduate from college with debts. It’s not uncommon to see someone with six figures of student loan debt, and these represent huge obstacles for the majority of people. If you want to launch a startup, you may be wondering how …

Airbnb Gets $1 Billion Debt Facility From U.S. Banks

Image credit:360b | Shutterstock.com Apartment-sharing startup Airbnb Inc. has secured a $1 billion debt facility from some big U.S. banks to aid its new services and finance its expansion plans, a source close to the company said. JPMorgan, Citigroup Inc., Morgan Stanley and Bank of America Corp. led the debt deal, the source said. Airbnb, …

You Cannot Cut Your Way to Growth

Image credit:Shutterstock I recently wrote about the war between driving growth and profitability and how you cannot successfully maximize both at the same time. The key point was that driving growth requires an additional investment in your business, in the form of new sales and marketing activities, expenses of which put negative pressure on your bottom line. So what happens when that additional investment …

Debt vs. Equity Financing: Which Way Should Your Business Go?

Image credit:Shutterstock Your small business needs extra capital. Should you take out a business loan or look for an investor? Figuring out how to finance your business is an important decision that can have big consequences. So which is better? Debt or equity? Let’s quickly go over their differences, then talk about how you can make …

Debt Is the Tiger That Will Eat Your Company

Image credit:Shutterstock Cheap money is like cheap food. It tempts some people to over-eat. Money has never been cheaper. Some nations, attempting to re-inflate their economies, are actually issuing zero percent loans to banks in the hope they will offer nearly zero percent money to businesses and consumers. Naturally, this cannot last forever, so it …