Posted by Ryan M. Newburn | Oct 17, 2023 |
Investment is a core pillar of economic growth. Fluid and easy access to investment capital allows firms to grow their businesses, develop new technologies, advance into new sectors, and hire more workers. Private and public capital markets serve an important and critical function in efficiently allocating capital.
Capital, broadly speaking, includes all the productive assets of a firm. Such productive assets could fixed or physical assets such as machinery, factories, or land, or financial assets used for investing or purchasing productive physical assets.
Financial capital is essential for the growth of a business. Businesses require such capital to buy new technology, machinery and hire employees. Often, companies must raise the financial capital necessary to grow their businesses, especially in the critical early periods where profits are speculative and costs are high.