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What is non-dilutive capital?

Christina Hernandez Sherwood, eMed Editor, MedCity News

What is non-dilutive capital?

Non-dilutive capital is money an entrepreneur receives that does not affect the ownership of the company. For example, a loan or a grant may require interest or carry special requirements about how the money is used, but it will not impact the shares of the company.

Government grants, through the Small Business Innovation Research program and others, are prominent examples of non-dilutive capital. Investors will often find a company more attractive when they see an entrepreneur has explored and tapped into these alternatives.

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