THE SPECIFICS OF RAISING EQUITY CAPITAL IN ENTREPRENEURIAL COMPANIES IN TIMES OF MODERN ECONOMIC TURBULENCE

Abstract

This study offers a discourse on the need to mobilize resources to attract investment in exchange for corporate rights issued by entrepreneurial business. Entrepreneurial company equity is viewed as the main source of raising profit and return to its shareholders, both in the future and in the current period, while the size and the dynamics of changes in equity capital reflect the efficiency of business performance. It is emphasized that for a long time, the domestic research studies and practice have neglected the issues of entrepreneurial companies’ funding at the expense of the share capital, since in the frameworks of the administrative and command economy, state-owned enterprises were endowed with authorized capital which could not be changed through emission (or cancellation) of corporate rights. It is also noted that instead, a number of studies focused mainly on anti-market methods of enterprise funding, such as budget grants, subsidies and subventions. However, it is argued that implementing rational policy in accumulating sufficient amount of equity capital, even in times of the Russian-Ukrainian war, will translate in success in arranging and ensuring normal functioning of entrepreneurial companies. Thus, the purpose of this paper is to explore the specifics of raising equity capital in entrepreneurial companies in the context of modern economic turbulence. To attain the research objectives, the study has employed the methods of logical generalization, system and comparative analysis. The findings also provide insights into conceptual framework and tools for raising equity capital in entrepreneurial companies along with revealing its key functions. In addition, the study suggests the structure of entrepreneurial company's equity capital and describes its types. The conclusions resume that in the process of raising equity capital for entrepreneurial companies in times of modern economic turbulence, there is a critical need to consider the specifics of operational and investment activities, the efficiency of available and future sources of equity capital, as well as take into account the functional significance of each of the constituent elements of equity capital.