Corporate Finance: The Art of Making Money Work for Companies

Generated by Copilot

Introduction

If “money makes the world go round,” then corporate finance is the one spinning the wheel. Whether you’re sipping coffee in a boardroom or bootstrapping a start-up from your basement, corporate finance determines how a company invests, raises funds, and survives the daily stress of paying bills.

A firm grasp of the basics — why it matters, how it shows up in real life, and how it quietly decides whether businesses thrive, fail, or end up in some awkward merger — can make a real difference.

What Is Corporate Finance?

At its core, corporate finance answers three deceptively simple questions:

1. What long-term investments should the firm engage in?
   Capital budgeting: Should we build a new factory, acquire a competitor, or let’s be honest — stick to upgrading the coffee machine?
2. How should the firm raise money for these investments?
   Capital structure: Borrow from banks, issue shares, or max out the corporate credit card (kidding, sort of).
3. How much short-term cash does the company need to keep the lights on?
   Working capital management: Because suppliers, employees, and the electricity bill are less patient than shareholders.