What are the financing methods?

Legal analysis: Enterprise financing includes direct financing and indirect financing. Direct financing refers to equity financing activities such as initial public offering (IPO), rights issue and additional issuance, so it is also called equity financing. At the same time, it includes equity-related financing, and investors have the rights and interests, decision-making power and management right of the company. Indirect capital financing refers to the debt financing activities of enterprises whose funds come from loans from banks and non-bank financial institutions. Investors have the priority to distribute the company's income and obtain interest income than the company's equity owners, so it is also called debt financing. Direct financing includes listing financing, private placement and public offering. Listing financing refers to the company's public offering of shares in the securities market to raise funds. Stocks can be listed at home, abroad, on the main board or in high-tech enterprises, such as the Growth Enterprise Market in the United States and Hong Kong. Issuing shares is a kind of capital financing, investors have the right to claim the profits of enterprises, but the investment funds can not be recovered, and investors bear greater risks, so the expected return required is higher than that of banks. From this perspective, the capital cost of stock financing is higher than that of bank loans.

Legal basis: Measures for the Administration of Initial Public Offering and Listing.

Article 8 An issuer shall be a joint stock limited company established and existing according to law.

With the approval of the State Council, when a limited liability company is changed into a joint stock limited company according to law, it may offer shares to the public by way of establishment.

Article 9 After the establishment of a joint stock limited company, the issuer shall continue to operate for more than three years, unless it is approved by the State Council.

Where a limited liability company is converted into a joint stock limited company according to the original book net asset value, the time for continuous operation can be calculated from the date of establishment of the limited liability company.