Shareholders' equity (capitaux propres)
Shareholders' equity represents the portion of resources belonging to the shareholders: share capital, accumulated reserves, and the current year’s profit. It acts as the buffer absorbing losses before creditors are exposed.
In practice
In a fundraising round, negotiations center directly on equity: every euro injected dilutes existing shareholders. A fast-growing network can carry negative equity if it has absorbed significant early losses — a sign the model has not yet reached structural breakeven. Banks typically require an equity-to-total-assets ratio above 20% before financing an acquisition.