Capital increase

3min

⚡TL;DR
Share capital = share's nominal value x number of shares. 
To increase its share capital, a company issues new shares. 
Issuing new shares enables the company to raise money for its operative needs. 
A capital increase is what happens when a financing round is implemented. 
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A GmbH/Sàrl has a share capital of a minimum of CHF 20'000. An AG/SA has a has a share capital of a minimum of CHF 100'000 (which can be partially liberated). See our Incorporation﻿ page for more information. 
The share capital is separated into multiple shares with an individual nominal value. The total of the shares' nominal values amount to the company's share capital.
Example 
Example AG has 10'000'000 shares with a nominal value of each CHF 0.01. 
10'000'000 x 0.01 = 100'000
Example AG has a share capital of CHF 100'000. 
The share capital of a company can fluctuate with time as the company grows and increases its share capital. 
A company increases its share capital by issuing new shares to new or existing shareholders. 
Example 
Example AG decides to sell 1'000'000 new shares to existing and new shareholders. 
After the sale, Example AG will have 11'000'000 shares with each a nominal value of CHF 0,01. 
After the sale, Example AG will have a share capital of CHF 110'000. 
Increasing your share capital enables you to raise money for the company. This is possible when selling the newly issued shares at a higher price than the nominal value. 
The difference between the nominal value and the price paid by the purchaser is the aggio and equals to the value of the company that the purchaser is willing to pay to become a shareholder. The price of the newly issued shares is defined by the valuation of the company. 
Example 
Example AG decides to sell its newly issued 1'000'000 shares at a price of CHF 0,10 per share, meaning 10 times the nominal value. 
Example AG will raise CHF 1'000'000 and will increase its share capital of CHF 100'000. 
A capital increase is the way a financing round is implemented. 
The process is the following: 
Existing shareholders or investors agree to pay a given amount of money at a defined valuation to the company in exchange for shares. 
The money is paid into a blocked bank account. 
The general assembly resolves on the capital increase. This resolution is notarized. 
The capital increase is notified to the commercial register. 
The money paid on the blocked bank account is released.
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Investment Agreement

M&A

Capital increase

⚡TL;DR

Share capital 101

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How can I increase my share capital?

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Why would I increase my share capital?

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How does it work?