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*you have lost a part of your business
*you have to share any profit made with these shareholders
* so overall in the long term you will most probably lose money
* conflict can occur between shareholders and other stakeholders (people with an interest in the business like employees and owners) This is because Shareholders just want the profit whereas owners want the best for there business, customers want good quality cheap goods and employees want a good wage an facilities
ADVANTAGES*You gain finance to improve business very quickly and easily (dont have to pay it back so no interest rates)*Shareholders can bring new ideas, skills and views to the business
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