# Capital Structure

> Analyze and plan capital structure — debt, equity, and hybrid financing — to support growth, risk tolerance, and cost of capital goals. Use when raising capital, refinancing, or evaluating leverage and dilution trade-offs.

- Skill: `itsual/capital-structure` (Agent Skill)
- Install (CLI): `npx skillmds@latest add itsual/capital-structure`
- Raw SKILL.md: https://api.skillmd.com/api/skills/itsual/capital-structure/raw
- Safety review: pending
- Works with: Claude Code, Claude.ai, OpenAI Codex
- Category: Marketing & Growth
- Author: itsual (https://skillmd.com/u/itsual)
- Updated: 2026-09-21
- Page: https://skillmd.com/skills/itsual/capital-structure

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# Capital Structure

## Overview

Capital structure is how a business finances itself. The mix of debt and equity affects risk, control, cost of capital, and flexibility.

## When to Use

- Fundraising and financing decisions
- Debt capacity and refinancing analysis
- Evaluating leverage targets
- Dilution vs debt trade-offs in growth plans

## Core Concepts

- Cost of debt vs cost of equity
- Leverage, coverage, and covenant headroom
- Dilution and ownership impact of equity raises
- Flexibility and refinancing risk
- Optimal structure depends on cash flow stability and growth stage

## Principles

- Cheap capital that creates distress risk is not cheap
- Stage and cash flow predictability constrain leverage
- Covenants and terms matter as much as headline rate
- Align financing with use of proceeds and timeline

## Verification

- [ ] Debt capacity linked to cash flow and covenants
- [ ] Equity dilution scenarios are explicit
- [ ] Financing plan matches strategic horizon